A Supreme Court ruling against the Trump-era tariffs could be the jolt the stagnating job market needs, according to Moody's Analytics chief economist Mark Zandi. In a recent social media post, Zandi highlighted the potential for the court's upcoming decision on the tariffs to alleviate pressure on employment and stimulate growth.

Zandi's warning comes on the heels of a disappointing December jobs report, which revealed a modest 50,000 increase in payrolls, bringing the unemployment rate down slightly to 4.4%. The full year 2025 saw the addition of only 584,000 jobs, a significant drop from the 2 million jobs created in 2024 and the weakest performance outside of a recession since the early 2000s. Zandi pointed out that since the implementation of the "Liberation Day" tariffs in April, the labor market has effectively stalled, with revisions likely to show net job losses.

The economist attributed the slowdown to the direct impact of tariffs on key sectors like manufacturing, transportation, distribution, and agriculture, all of which have experienced consistent job losses. He also noted the indirect effect of increased uncertainty on hiring decisions across most businesses. Trade-exposed industries suffered considerably throughout the past year, with the manufacturing sector alone shedding 70,000 jobs.

The tariffs, initially imposed by the Trump administration, aimed to protect domestic industries and encourage American manufacturing. However, critics argue that they have instead raised costs for businesses, disrupted supply chains, and ultimately hindered economic growth. The Supreme Court's impending decision carries significant weight, as a ruling against the tariffs could remove a major impediment to job creation and economic recovery. Conversely, upholding the tariffs could further exacerbate the current stagnation and potentially lead to further job losses in vulnerable sectors. The business community is closely watching the court's decision, anticipating its potential to reshape the economic landscape.