Get PolitiFact in your inbox.
If Your Time is short
• Biden can claim successes with falling unemployment rates, steady gains in job creation, and labor-force participation rates that are nearing their pre-pandemic levels.
• Several other measures on his watch initially worsened but now seem to be headed in the right direction. These include inflation, gross domestic product, gasoline prices, inflation-adjusted wages and consumer confidence.
President Joe Biden has reasons to be satisfied with the nation’s economic performance under his watch, including low unemployment rates and efforts he led to help the economy rebound from COVID-19. But his time in the Oval Office has also been consumed by frustration over 40-year-high levels of inflation.
On the occasion of Biden announcing his re-election bid, PolitiFact examined how 14 key economic markers have changed since Biden took office in January 2021.
Even though presidential policies can affect the nation’s economic health, no president can be fully credited with, or blamed for, everything that goes into the economy.
With that in mind, let’s examine the performance of manufacturing job gains, gasoline prices, the stock market, consumer confidence and other factors under Biden’s watch.
The nation’s overall unemployment rate has dropped sharply on Biden’s watch, from 6.3% when he took office to 3.5% in March. Although Black and Hispanic Americans continue to have higher unemployment rates than whites do, the trend has been declining unemployment rates for every racial and ethnic group.
The Black unemployment rate has fallen from 9.2% to 5% over the same period, and the Hispanic unemployment rate has fallen from 8.5% to 4.6%.
The March 2023 rates, the most recent available, show unemployment rates for all categories at or near historical lows.
The pattern of job gains has likely helped to cool inflation. Although the economy has gained jobs every month during Biden’s presidency, the scale of monthly job gains has generally declined since August 2022.
From the start of Biden’s presidency until July 2022, the economy averaged a net increase of 553,000 jobs per month. Since August 2022, the average has averaged a solid, but more modest, 324,000 jobs per month.
The declining scale of monthly job gains is considered good news. The more the economy cools on its own, there is less pressure on the Federal Reserve to raise interest rates.
Biden has prioritized creating manufacturing jobs, building the sector into his legislative priorities.
Overall, Biden’s record in this sector has been strong: The economy created manufacturing jobs every month between May 2021 and January 2023, by between 6,000 and 73,000 per month. Preliminary data for February and March 2023 show small decreases, though these could be revised in future months.
Industrial productivity has also risen on Biden’s watch. A productivity gain comes when something can be produced more quickly or more cheaply than was possible previously. It’s an important statistic, because greater productivity means wages can be raised without nudging inflation higher.
During Biden’s presidency, the standard measure of the economy’s productivity has risen fairly consistently.
The worst economic metric on Biden’s watch has been inflation.
Although high inflation began because of supply-chain challenges during the pandemic, economists say Biden’s pandemic relief policies exacerbated matters. By giving Americans too much money to spend when goods and services supplies were too scarce, COVID-19 relief measures, including the American Rescue Plan, drove prices higher.
The year-over-year inflation rate maxed out around 9% over the summer, far above the Federal Reserve’s target of about 2%. But over the past nine months, inflation has eased, falling slightly below 5%. That’s still high, and the chance of a recession during Biden’s first term remains real. But it’s been going in the right direction.
Another closely watched metric is gross domestic product, which refers to the total market value of all the finished goods and services a nation produces.
GDP dropped rapidly during the pandemic recession when Trump was president, but grew by rates faster than the historical norm under both Trump and Biden. In three of Biden’s first four quarters, GDP growth exceeded 6%.
Then, the economy began shrinking. The economy contracted modestly in 2022’s first two quarters. This led to worries that the economy had already turned into a recession.
As it happened, no recession for this period has been officially declared — the official definition includes more than just two straight quarters of negative growth — and the subsequent two quarters turned positive. The two most recent quarters had GDP growth around 3%, which is in line with recent historical norms.
This doesn’t mean a recession won’t hit soon, but it makes it possible that the economy could have a "soft landing" from the Fed’s interest rate hikes.
High inflation, meanwhile, has hurt workers by cutting into their wages.
For the first year and a half of Biden’s presidency, inflation-adjusted wages fell. But over the past two quarters, wage gains started to outpace inflation.
One notable trend is that lower-paid workers have gained more in wages, relatively speaking, than higher-paid workers.
This seems to have driven some workers back into the labor force. Labor force participation measures the percentage of the population 16 and older that is working or looking for work. The economy benefits when this percentage is higher, because it means more people are economically productive.
This metric remains below its pre-pandemic peak, but the good news for Biden is that labor force participation has risen, at least modestly.
The ratio of job openings to workers could push reluctant workers into the labor market. When Biden took office, there were more jobless people than job openings. Now, there are about 1.7 job openings per unemployed worker.
If there’s one economic statistic that galls Americans, it’s the price at the pump.
When Biden took office, the economy was relatively weak because of the pandemic. As a result, demand for gasoline sagged, and prices were relatively low, around $2.40 a gallon. By February 2022, the eve of Russia’s war in Ukraine, the price had risen above $3.50. The war scrambled the world’s petroleum supply, and by midsummer, U.S. gasoline prices were pushing $5 a gallon.
Since then, the price has dropped to around $3.42. That’s far lower than the peak price, but it’s still higher than when Biden took office.
Another closely watched statistic is home values. They have risen through much of Biden’s presidency, giving homeowners increased net worth that they can unlock through home-equity loans. The downside is that higher prices make it harder for first-time homebuyers to enter the market.
Home prices have softened since July 2022. One possible silver lining is that this could make housing more affordable.
Despite rising home prices, homeownership rates have risen modestly on Biden’s watch.
During Biden’s first year in office, the S&P 500, a broad stock market index, rose by about 20%. But in 2022, the S&P 500 gave away most of those gains, amid growing concerns about inflation and a possible recession.
The S&P 500 bottomed out in the fall of 2022 and has risen since, by enough to leave it higher than when Biden took office.
Along with inflation, the stock market’s performance seems to have eroded the public’s economic confidence.
A widely watched University of Michigan survey shows consumer confidence fell after Biden was sworn in. But after bottoming out as inflation eased, consumer confidence has risen since summer 2022.
Nevertheless, confidence remains modestly below where it was when Biden took office.
Federal Reserve Bank of St. Louis, unemployment rate, accessed Apr. 25, 2023
Federal Reserve Bank of St. Louis, unemployment rate, white, accessed Apr. 25, 2023
Federal Reserve Bank of St. Louis, unemployment rate, Black, accessed Apr. 25, 2023
Federal Reserve Bank of St. Louis, unemployment rate, Hispanic, accessed Apr. 25, 2023
Federal Reserve Bank of St. Louis, unemployment rate, Asian, accessed Apr. 25, 2023
Federal Reserve Bank of St. Louis, median weeks unemployed, accessed Apr. 25, 2023
Federal Reserve Bank of St. Louis, all nonfarm employees, accessed Apr. 25, 2023
Federal Reserve Bank of St. Louis, all manufacturing employees, accessed Apr. 25, 2023
Federal Reserve Bank of St. Louis, labor force participation rate, accessed Apr. 25, 2023
Federal Reserve Bank of St. Louis, labor force participation rate, men, accessed Apr. 25, 2023
Federal Reserve Bank of St. Louis, labor force participation rate, women, accessed Apr. 25, 2023
Bureau of Economic Analysis, gross domestic product change by quarter, accessed Apr. 25, 2023
Federal Reserve Bank of St. Louis, median usual weekly real earnings for full-time wage and salary workers, 16 years and over, accessed Apr. 25, 2023
Federal Reserve Bank of St. Louis, Consumer Price Index for All Urban Consumers: All Items in U.S. City Average, accessed Apr. 25, 2023
Energy Information Administration, U.S. Regular All Forumulations Retail Gasoline Prices, accessed Apr. 25, 2023
Federal Reserve Bank of St. Louis, homeownership rate, accessed Apr. 25, 2023
Federal Reserve Bank of St. Louis, industrial production index, accessed Apr. 25, 2023
Yahoo! Finance, S&P 500 historical data, accessed Apr. 25, 2023
Federal Reserve Bank of St. Louis, University of Michigan consumer sentiment survey, accessed Apr. 25, 2023
Federal Reserve Bank of St. Louis, S&P/Case-Shiller U.S. National Home Price Index, accessed Apr. 25, 2023
Federal Reserve Bank of St. Louis, job openings, total nonfarm, accessed Apr. 25, 2023
Federal Reserve Bank of St. Louis, unemployment level, accessed Apr. 25, 2023