When the economy sputters, Americans look for someone to blame. Often, the finger gets pointed at the White House. 

But how much credit or criticism does the president really deserve? The answer will be central to the 2024 presidential campaign, which has already kicked off and might well become a showdown between the current and immediate past residents of 1600 Pennsylvania Ave. So, with former President Donald Trump and President Joe Biden touting their respective economic records, 

took a look at how various aspects of the economy fared under each administration. 

The economic record, for both, is mixed. Trump inherited a healthy economy from former President Barack Obama that was eight years past the 2007-09 economic downturn, and steadily expanding. In the period under study, job growth chugged along and inflation was tame. But wages were flat, and increases in the gross domestic product and job creation were more or less a continuation of trends that began in the Obama years, rather than a direct result of any changes that Trump made.

Trump had one major legislative victory in his early years: a suite of tax cuts on companies and individuals passed in 2017. The measures helped boost the stock market and fueled investment and demand, but also drove up the size of the U.S. debt.

Biden took office as the economy was still recovering from the Covid pandemic shutdowns, and the steady flow of stimulus aid passed under both his watch and Trump’s fueled a major spending boom. That helped job growth soar to record levels in each of the past two years, but also drove up inflation and forced the Federal Reserve to begin rapidly tightening monetary policy—steps that could spark a recession in the months ahead. 

Economists caution that U.S. presidents have only limited influence over the nation’s sprawling economy, which is less a real-time reflection of incremental changes in public policy than the product of millions of individual choices that consumers and businesses make every day. But presidents should be judged “on how they use the power of their office and the impact of those decisions,” says Aaron Sojourner, a labor economist with the W.E. Upjohn Institute for Employment Research.

The following charts examine how 11 different elements of the economy trended during the early years of both the Trump and Biden administrations. 

 compared identical time frames for each president, beginning with Inauguration Day and continuing through April of their third year in office, or the latest month for which data were available.

https://images.barrons.com/im-797200?width=1280&size=17.297

Trump pledged during his 2016 presidential campaign that he would be able to return the U.S. economy to 4% annual growth. But he hit that target in only two quarters: the fourth quarter of 2017 and the third quarter of 2020, when the U.S. economy was first reopening and recovering from the Covid-19 pandemic.

From the first quarter of 2017 to the first quarter of 2019, growth in real GDP (adjusted for inflation) averaged 2.5% per quarter. That’s a healthy level for a huge and diverse economy that generally sees growth of 2% to 3% each year, but it is far from the levels that Trump had been promising, and on par with growth rates at the end of Obama’s second term.

Biden oversaw soaring economic growth in his first year in office as federal stimulus money flowed to counter the pandemic’s economic effect. Growth in two of his first four quarters hit a 7% annual rate. Inflation came to bite in his second year in office, however, and growth turned negative for the first half of 2022. 

Even so, Biden has overseen a faster rate of growth, on average, than Trump. From the first quarter of 2021 to the first quarter of 2023, the most recent period for which data are available, economic growth under the Biden administration averaged 3.1% per quarter.

The stock market’s performance was paramount for Trump, who oversaw a 21.2% jump in the S&P 500 index from his first day in office through the end of May 2019, nearly 2½ years later. His 2017 tax cuts helped create a conducive environment for business investment, while low unemployment levels encouraged consumer spending.

Under Biden, the S&P 500 gained 8.5% during the comparable time span. Call it a tale of two markets: Stocks hit an all-time high at the start of 2022, but the benchmark S&P 500 plummeted 20% last year, and the tech-heavy Nasdaq Composite, roughly 33%, as the Federal Reserve tightened monetary policy to rein in soaring inflation. This year, the S&P 500 gained 9.3% through May 31, fueled in part by expectations that the Federal Reserve will soon stop raising interest rates, and might even pivot to cut them later in the year.

During the Trump era, the U.S. enjoyed a period of relatively tame inflation, a continuation of the historically low levels experienced during Obama’s two terms in office. Inflation averaged 1.4% from the second quarter of 2009 to the fourth quarter of 2016, and 2.2% in the first two years of the Trump administration through the first quarter of 2019. 

The government’s response to the Covid pandemic, which hit the U.S. in force in March 2020, and the outbreak of the war in Ukraine in February 2022 changed the trajectory of price growth, however. As the Trump and Biden administrations flooded the financial system with money to offset Covid-related losses, and as supply chains were scrambled by Russia’s invasion of Ukraine, inflation soared to the highest level in four decades and became the No. 1 economic problem of the Biden era. 

The Fed, which initially considered inflation as transitory, began raising interest rates in March 2022 to cool economic growth. But more than a year later, inflation has proved stickier than anticipated. After 

, a consumer price index reading of 4.9% this past April marked the 

 in the annual pace of inflation. But monthly increases persist, and the Fed’s preferred inflation gauge, the personal-consumption expenditures price index, remains well above the central bank’s 2% target.

That inflation, particularly in the form of high food costs, continues to dog the Biden presidency. Despite a historically strong labor market and significant wage increases, enduring high prices have suppressed consumer confidence and eroded Americans’ spending power. 

The Federal Reserve raised interest rates slowly and steadily throughout the first half of the Trump presidency as it attempted to bring monetary policy back into neutral territory after years of near-zero rates. Trump regularly lashed out at the Fed for this approach, arguing that higher rates were making it harder for the U.S. economy to compete on the global stage. But with inflation in check, the Fed continued hiking until 2019, when recession fears and concerns about a global slowdown led it to begin loosening monetary policy.

Biden’s administration, meanwhile, has seen some of the most aggressive monetary-policy tightening in decades as the Fed has worked to rein in inflation. That has brought price growth down from its peak, but has also made car- and homebuying more expensive, prompted layoffs in rate-sensitive industries, and spooked investors, who are bracing for a recession.

Both presidents oversaw huge increases in the size of the federal debt, largely due to Trump’s tax cuts and Biden’s Covid aid programs. 

The Trump administration also enacted major Covid-aid spending that drove up the debt in the latter part of the president’s term, but those outlays were widely agreed-upon by both parties.

Much of the recent growth in the size of the federal deficit is due to long-term trends and the expansion of programs such as Medicare, Medicaid, and Social Security, which are becoming more expensive as the U.S. population ages. Charles Blahous, a senior research strategist with the Mercatus Center at George Mason University, estimated in a 

 that some 60% of the total long-term fiscal imbalance is due to policies created in the late 1960s and early 1970s, when those programs were enacted.

As for the 2021 federal deficit, Blahous estimated that Trump bore responsibility for 19.1% of it, and Biden, 18.5%.

Trump oversaw strong job growth at the start of his term, with the labor market creating 180,000 jobs on average per month. That was a healthy level for an economy already nearly a decade into a recovery from the recession induced by the financial crisis of 2008-09. And it was well above the roughly 100,000 jobs that economists estimate are needed per month to keep pace with population growth.

Biden has seen the labor market surge, with monthly job growth averaging 470,000 positions since he took office. To be sure, he inherited a post-Covid recovery in a labor market that had plenty of room to grow, but job creation has consistently surpassed economists’ expectations, even as recession fears have increased.

Biden’s first two years in office were the strongest two years of job growth on record in U.S. history. The overall size of the labor market has now more than recovered from the downturn caused by the Covid-19 recession.

Trump frequently bragged about the strength of job growth under his watch. With good reason: Unemployment fell to a 50-year low of 3.5% in 2019—the 

Princeton economics professor Alan Blinder argued

 that the boost wasn’t a direct result of the administration’s policies, and that unemployment drop subsequently was overshadowed by the effects of the Covid-19 pandemic. 

Biden, on the other hand, inherited an unemployment rate of 

 in January 2021, and saw the rate fall steadily to a low of 3.4% as of April 2023. Yet, there has been little political payoff.

The current rate might represent a watermark for the administration as Fed officials attempt to curb inflation. 

New York Fed President John Williams anticipates

 that the unemployment rate will need to rise to 4%-4.5% to get inflation down from the CPI’s 4.9% reading in April and back to the 2% target rate.

The number of working Americans has been in decline for decades. Experts attribute this to a number of factors, including declining birthrates, 

 restrictive immigration policy, and even a shift in the 

. All are beyond the control of any one president’s or administration’s policies. 

Yet that trend paused under Trump. His administration scored a slight 0.1 percentage point bump in the overall number of working Americans during his first two years in office. Under his predecessor, Obama, the overall labor-force participation rate of Americans over the age of 16 dropped 2.9 percentage points. 

Based on the number of prime-age working Americans ages 25 to 54—a metric that tends to be less affected by retirement trends and work delays due to education—Trump arguably did even better, boosting the rate by 0.7 percentage points. 

Labor participation took a hit at the onset of the Covid-19 pandemic, but the Biden administration has seen some recovery. Overall labor participation hit 62.6% in April 2023, just off the prepandemic highs achieved under Trump. The prime-age labor-force participation rate, however, is now 

 and surpassing any of the benchmarks hit during the Trump years. 

Trump declared that the U.S. was in a “blue-collar boom” during his final 2020 State of the Union address, with hourly labor costs to employers increasing by about 6% within the first half of his presidency. Inflation-adjusted wage and salary levels rose at a slower pace during Trump’s initial years in office.  

American pay hasn’t fared better under Biden. Labor shortages helped push private workers’ pay up an average of 10.3% year over year from January 2021 to April 2023. But the spending power of those pay increases was largely wiped out due to historically high inflation. Even as inflation persists, wage increases are waning, and economists expect pay to fall to prepandemic levels by the end of 2023 or early 2024.

The lack of real wage gains could pose political problems for the Biden re-election effort, and continue to drag down consumer confidence. Yet, the effect on overall inflation has been small so far, recent 

research from the San Francisco Fed shows

U.S. home prices have been on the rise for nearly three decades, with the median sale price more than tripling from $126,000 in 1992 to $479,500 by the end of 2022, according to 

Trump administration touted rising property values

, some of the steepest increases in median home sale prices in the past 30 years occurred 

during the first two years of the Biden administration

 as the desire for more space collided with a general housing shortage following the onset of the Covid pandemic. 

Rising property values are good news for homeowners, but challenging for would-be buyers. 

that homeownership improves financial stability among U.S. consumers. Increasingly unaffordable home prices can jeopardize this. That said, the market has eased. Annual house-price growth 

, the slowest pace in more than 10 years, according to the S&P CoreLogic Case-Shiller National Composite Index. Housing experts predict that the current housing-market correction probably will continue through 2023 and into 2024. Falling prices should help improve affordability, particularly once mortgage rates ease after the Fed ends its rate hikes. 

While Trump enjoyed relatively strong consumer confidence during the early years of his presidency, probably due to the long-running bull market, the Covid pandemic erased that optimism and left the Biden administration continually struggling to recover. Even after the threat of Covid outbreaks declined, soaring inflation depressed confidence levels. They hit a record low in June 2022. 

Consumer confidence is an important economic indicator, as 

consumer spending drives nearly 70% of the U.S. economy

. If Americans are worried about the economy, they typically don’t shop as much. Yet consumer spending jumped 0.5% in April, even as Americans’ confidence has been shaken again by persistently high prices and lower real wages that reduce spending power. 

“Throughout the current inflationary episode, consumers have shown resilience under strong labor markets, but their anticipation of a recession will lead them to pull back when signs of weakness emerge,” wrote Joanne Hsu, Surveys of Consumers director at the University of Michigan. 

: The U.S. has trillions of dollars in total outstanding debt. A previous version of a chart in this article incorrectly said debt levels were in the quadrillions. 

Megan Cassella is a reporter for Barron's based in Washington, D.C., covering economics and policy. Before joining Barron's she covered a range of economic and political news—including trade policy, employment, and the 2016 and 2020 presidential campaigns—for Politico and Reuters.

Reporter

Megan Leonhardt is a senior writer for Barron’s covering economic issues. Before joining Barron’s, she worked at Fortune covering labor, financial, and economic trends. She previously held reporting roles at CNBC and Money magazine.

Senior Writer

President Trump and President Biden will both crow about their economic achievements ahead of the 2024 election. So, how'd they do? We took a look.

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https://images.barrons.com/im-796392?size=1.5

The president and his predecessor will both crow about their economic achievements ahead of the 2024 election. So, how did they do? Barron's took a look at the numbers.

President Trump and President Biden will both crow about their economic achievements ahead of the 2024 election. So, how'd they do? We took a look. 

The Trump vs. Biden Economy: A Comparison in 11 Charts

The president and his predecessor will both crow about their economic achievements ahead of the 2024 election. So, how did they do? Barron's took a look at the numbers.

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