Growth, inflation, jobs: Biden and Trump’s economic records compared

United States President Joe Biden and former US President Donald Trump’s first debate of the 2024 campaign has refocused attention on their respective economic records in office.

During Thursday’s head-to-head, the candidates clashed on the economy, with Biden taking credit for overseeing the recovery from the COVID-19 pandemic and Trump claiming to have presided over “the greatest economy in the history of our country”.

Both Biden and Trump could point to strong performances in particular areas of the economy, but opinion polls have consistently shown that voters have more trust in the Republican’s ability to handle economic and cost-of-living issues.

In an ABC News/Ipsos poll released last month, 46 percent of respondents said they trusted Trump on the economy, compared with 32 percent for Biden.

On inflation, Trump was favoured over the Democrat by 44 to 30 percent.

Polls also show that Americans overwhelmingly view the economy as their top priority, meaning that Biden’s re-election hopes are likely to live or die depending on his ability to sell a positive economic message.

Below are Trump and Biden’s economic records compared in four key areas.

Economic growth

Both the Biden and Trump administrations oversaw periods of robust growth.

Since Biden’s inauguration, gross domestic product (GDP) has increased by 8.4 percent when adjusted for inflation.

Under Trump, GDP grew 6.8 percent – but that includes the plunge in economic activity that occurred during the first year of the pandemic.

Excluding 2020, Biden comes out slightly ahead, with an annualised growth rate of about 2.9 percent, compared with just under 2.7 percent for Trump.

Inflation

Biden’s tenure has been marked by far higher inflation compared with Trump’s – although many of the factors driving high prices, such as COVID-related supply chain disruptions, were out of his control.

Since Biden came to office, prices have risen more than 19 percent.

The average price of a gallon (3.8 litres) of petrol rose from $2.33 to $3.76 between January 2021 and May of this year, according to the US Bureau of Labor Statistics.

The cost of a loaf of bread increased from $1.55 to $1.97, while the price of a dozen eggs jumped from $1.47 to $2.70

At a similar point in Trump’s presidency, prices had only risen about 5 percent.

While inflation has come down sharply since peaking at 9.1 percent in mid-2022, it remains stubbornly high.

The consumer price index last month stood at 3.3 percent, well above the US Federal Reserve’s target of about 2 percent.

Jobs

Biden and Trump can both claim to have presided over strong labour markets.

Unemployment fell to a 53-year low of 3.4 percent in January last year and has stayed below 4 percent for all but one month since then.

Excluding 2020, Trump also oversaw a period of low unemployment, with the jobless rate hitting a low of 3.5 percent in late 2019.

Under Biden, the economy has added about 15.7 million jobs.

By contrast, Trump left office with some three million fewer jobs – although that figure was skewed by the pandemic.

However, even before the pandemic, job creation grew at a slower pace during Trump’s administration than it has under Biden.

Wages

While Biden and Trump both presided over solid wage growth on paper, US workers have seen their earnings decline in real terms under Biden due to inflation.

Under Trump, wage growth stayed above inflation, delivering modest rises in workers’ incomes.

From March 2021, consumer prices began to diverge from earnings, before the trend started to reverse in early 2023.

The upshot is that real median weekly wages fell by 2.14 percent between the start of Biden’s term and the first quarter of 2024, according to a FactCheck.org analysis citing US Bureau of Labor Statistics data.

The positive news for US workers is that wages have started growing again.

In May, real wages rose 0.5 percent compared with the previous year, although they have yet to recover to their levels at the start of Biden’s tenure.

“While real wage growth has turned slightly positive in recent months, the level of real wages is still below where they were at the onset of the inflation surge that we began to see in the first quarter of 2021,” the Federal Reserve Bank of Atlanta said in an analysis on Thursday.

“Simply put, real wages haven’t fully caught up to the sudden burst in inflation.”