SUMMARY

Michael Bordenaro analyzes the dire August 2025 jobs report, revealing a collapsing U.S. job market with stagnant growth, rising unemployment, AI-driven losses, and skepticism toward Federal Reserve rate cuts amid recession-like conditions.

STATEMENTS

• In August 2025, U.S. employers added only 22,000 jobs, far below expectations, with the unemployment rate rising to 4.3%, marking four consecutive months of weak job growth.
• Job creation has nearly halted since early 2021, with slowdowns across manufacturing, construction, professional services, and government, while only healthcare and hospitality show gains.
• For the first time in years, job seekers outnumber available openings, exacerbating scarcity and signaling a standstill in the labor market reminiscent of the Great Recession.
• Recent college graduates face a doubled unemployment rate of 9.3% in August 2025, up from 5.4% in January, challenging the narrative that degrees guarantee employment.
• Manufacturing activity has contracted for six straight months in 2025, with Americans cutting back on dining, hotels, and non-essentials, potentially worsening economic strain through reduced spending.
• The Trump administration pressures the Federal Reserve to cut interest rates, promising future job booms from tariffs and reduced immigration, though tariffs face constitutional challenges.
• Job losses in 2025 total 892,000 nationwide by August, surpassing all of 2024 and 66% more than the prior year, with California hit hardest outside government sectors due to AI in tech.
• Futures markets predict Federal Reserve rate cuts in September, October, and December to stimulate the economy, abandoning inflation fights despite underlying debt-driven issues.
• AI has contributed to over 20,000 job losses in 2025, compounding economic woes as companies prioritize productivity gains over rehiring amid high living costs.
• Retailers anticipate a weak holiday season with fewer seasonal hires, blaming tariffs, inflation, and uncertainty, yet consumer spending on gifts persists despite affordability strains.

IDEAS

• Official recession labels matter less than raw data showing job scarcity worse than during the Great Recession, highlighting a disconnect between government narratives and lived realities.
• Low interest rates, blamed for past crises like 2008, may provide short-term job boosts but ultimately fuel inflation and debt cycles without addressing structural issues like AI displacement.
• College degrees, once pitched as essential for success, now trap young graduates in a twice-as-tough job market, questioning the value of traditional education paths in an AI era.
• Tariffs intended to repatriate manufacturing jobs face legal hurdles, creating uncertainty that discourages investment and prolongs labor market stagnation.
• Government and economists prioritize economic metrics over individual hardships, expecting debt-fueled spending to sustain growth even as families cut back essentials.
• AI's rapid adoption benefits corporate profits through efficiency but devastates entry-level and white-collar jobs, timing poorly with already high living costs and weak wage growth.
• Job growth in hospitality and healthcare persists amid broader collapse, suggesting a bifurcated market where low-wage service roles endure while skilled sectors suffer.
• Downward revisions in jobs data, a recurring pattern, erode trust in official reports, implying the true economic picture is even bleaker than publicized.
• States like Texas and Nevada buck national trends by gaining jobs, possibly due to diverse economies less exposed to tech and manufacturing vulnerabilities.
• Holiday spending traditions endure economic downturns, potentially masking deeper issues as consumers borrow for non-essentials, perpetuating debt dependency.

INSIGHTS

• The job market's collapse reveals a fundamental illusion in economic optimism, where repeated assurances of strength ignore AI's irreversible disruption and data revisions that consistently worsen the outlook.
• Pressuring the Fed for rate cuts echoes historical errors, as artificial stimulation delays necessary pain—like higher unemployment—that could purge inefficient debt-laden businesses for a reality-based recovery.
• Rising graduate unemployment underscores education's obsolescence for many, shifting value toward practical skills over degrees in a landscape where AI automates routine tasks faster than curricula adapt.
• Immigration reductions and tariffs, while aiming to favor American workers, risk backfiring amid legal voids, prolonging uncertainty and hindering the "pain now for gain later" strategy.
• Consumer cutbacks on non-essentials signal prudent adaptation, yet systemic reliance on debt-driven spending prioritizes aggregate growth over sustainable personal finances, trapping families in cycles of overextension.
• California's tech-heavy losses from AI highlight regional vulnerabilities, where innovation hubs become casualties of their own advancements, widening inequality between thriving service states and declining industrial ones.

QUOTES

• "The job market is at a complete standstill and is showing no signs of improving anytime soon."
• "You could have interest rates at zero and it's not going to bring back jobs that have been taken away by AI."
• "I feel like I've been lied to by everybody that told me I needed to go to college in order to get a good job and be competitive in the workforce."
• "Lowering interest rates and having low interest rates for artificial reasons just like this is what got us into this mess."
• "If you want a job, go look for a job at a hotel or restaurant because 28,000 hotel and restaurant jobs were created in August."

HABITS

• Maintain skepticism toward official economic narratives by cross-referencing raw data like jobs reports and revisions rather than relying on headlines or government assurances.
• Prioritize building specialty skills in resilient sectors like healthcare or hospitality to navigate a bifurcated job market where broad opportunities dwindle.
• Avoid debt accumulation for non-essentials, focusing instead on cutting back spending to match income realities amid rising unemployment and inflation.
• Stay informed on policy shifts, such as Fed decisions and tariff rulings, to anticipate labor market changes and adjust personal strategies accordingly.
• Diversify location considerations, eyeing job-gaining states like Texas or Nevada over vulnerable ones like California for better employment prospects.

FACTS

• U.S. job additions averaged just 88,000 over the past three months through August 2025, one-third of the prior year's pace, with June revised to show a 13,000-job loss.
• Unemployment for recent college graduates surged to 9.3% in August 2025, more than doubling from 5.4% in January.
• Nationwide job cuts reached 892,000 by end-August 2025, 66% above the same period last year and exceeding all of 2024.
• California's job losses hit 135,241 in 2025, a 24% increase year-over-year, led by tech due to AI, with New York seeing a 33% rise percentage-wise.
• AI accounted for over 20,000 of 2025's job losses, coinciding with manufacturing contraction for six months and reduced consumer spending on dining and hotels.

REFERENCES

• Bureau of Labor Statistics jobs report for August 2025.
• Challenger Gray and Christmas report on seasonal hiring projections.
• Federal Reserve statements by Jerome Powell on labor market conditions.
• Apple News articles on jobs data revisions and economic indicators.

HOW TO APPLY

• Monitor monthly jobs reports from the Bureau of Labor Statistics, focusing on revisions and sector breakdowns to gauge true market health beyond initial headlines.
• Assess personal skills against resilient sectors like healthcare and hospitality, upskilling via online courses if needed to target openings in growing areas.
• Build an emergency fund covering 6-12 months of expenses, reducing non-essential spending to weather potential unemployment spikes and inflation.
• Research state-level job trends, considering relocation to gaining regions like Texas for better opportunities amid national contraction.
• Track Federal Reserve announcements on rate cuts, preparing for inflation surges by locking in fixed-rate debts or investing in inflation-hedging assets like real estate.

ONE-SENTENCE TAKEAWAY

The 2025 job market collapse demands skepticism of quick fixes like rate cuts, urging skill adaptation amid AI disruptions for long-term resilience.

RECOMMENDATIONS

• Shun unnecessary college debt for degrees in oversaturated fields, opting for vocational training in AI-resistant trades to enter the workforce faster.
• Advocate for higher interest rates to force economic restructuring, eliminating zombie companies and fostering genuine growth over debt-fueled illusions.
• Diversify income streams beyond traditional employment, exploring gig work in hospitality or freelance tech roles to buffer against sector-specific losses.
• Prepare for holiday spending pitfalls by budgeting strictly, prioritizing savings over traditions that exacerbate personal debt in uncertain times.
• Engage with policy debates on tariffs and immigration, supporting measures that prioritize domestic job creation while mitigating legal and inflationary risks.

MEMO

In the sun-dappled paths along Corte Madera Creek in Larkspur, California, Michael Bordenaro delivers a stark wake-up call on the unraveling American job market. August 2025's report from the Bureau of Labor Statistics paints a grim picture: just 22,000 jobs added, well below forecasts, with unemployment climbing to 4.3%. This follows four months of anemic growth, a far cry from the robust economy touted by officials. Revisions, often downward, suggest the reality could be even bleaker—June alone lost 13,000 positions upon recalculation. Bordenaro, walking amid the creek's serene flow, contrasts this data with persistent claims of strength, noting slowdowns in manufacturing, construction, and services, while only healthcare and hospitality limp forward.

The malaise extends beyond numbers. For the first time in years, job seekers outnumber openings, evoking the Great Recession's shadows. Recent college graduates, burdened by tuition debt, face a jobless rate doubled to 9.3% since January—a betrayal of the promise that degrees ensure prosperity. Bordenaro critiques this outdated gospel, arguing education's value has eroded in an AI-driven world automating roles faster than academia can pivot. Manufacturing contracts for the sixth straight month, consumers pare back on dining and travel, and economists fret over a spending spiral that could deepen the downturn. Yet, the Trump administration pins hopes on tariffs to summon factories home, dismissing current woes as temporary pain for future gain—though recent court rulings deeming tariffs unconstitutional sow fresh doubt.

AI emerges as the silent saboteur, claiming over 20,000 jobs this year alone, particularly in California's tech heartland. The state leads non-government losses with 135,241 cuts, a 24% jump, as pharmaceuticals, finance, and retail reel from inflation and uncertainty. Nationwide, 892,000 positions vanished by August, eclipsing 2024's total. Bordenaro questions the Federal Reserve's pivot to rate cuts in September, October, and December, warning they echo the low-rate follies that birthed the 2008 crisis. Jerome Powell's recent assurances of a "solid" labor market now ring hollow, exposed by July's underwhelming data. Instead, Bordenaro advocates raising rates to purge debt-dependent firms, enduring short-term hardship for a resilient economy rooted in real demand.

As holidays loom, retailers brace for a feeble season with minimal seasonal hires—the lowest since 2009—blaming tariffs and costs, yet Bordenaro predicts Americans will overspend on gifts regardless, perpetuating debt cycles. States like Texas and Nevada buck the trend with gains, underscoring regional divides. For workers, the advice is pragmatic: seek hospitality roles, where 28,000 opened last month, and fortify against inflation lurking at 3% officially—likely double in truth. Bordenaro's dispatch from California's creekside isn't mere gloom; it's a call to adapt, questioning narratives that sacrifice families for abstract growth in a market teetering on collapse.