Economic tailwinds for Kamala Harris has few parallels, economists say

The surprisingly positive jobs report Friday has reinforced growing optimism about the U.S. economy, less than a month before the end of an extremely close presidential race between Vice President Kamala Harris and former President Donald Trump, and while voters say the economy is a top priority.

Nonfarm payrolls added 254,000 jobs in September, while the unemployment rate fell to 4.1%, down 0.1 percentage points. These numbers smashed expectations, with the Dow Jones consensus forecasting 150,000 additional jobs for the month.

“It was a very good report across every indicator in there,” said Aaron Sojourner, a senior researcher at the W.E. Upjohn Institute for Employment Research. “Wage growth is strong. Working families are gaining purchasing power.”

The good news comes in the final leg of a fiercely fought campaign, where the economy has been a major focal point.

As they barnstorm across battleground states, Harris and Trump paint dueling pictures of the U.S. labor market.

“This horrific nightmare for American workers ends the day I take the oath of office,” Trump said at a rally in Michigan Oct. 3.

In stark contrast, Harris said in a CBS “60 Minutes” interview that aired Monday, “We now have an economy that is thriving by all macroeconomic measures.” In particular, Harris cited “historic low unemployment in America among all groups of people.”

The jobs report adds to a flurry of good economic news in recent weeks, with metrics that could potentially amount to the best economic upswing in decades.

“I’ve hesitated to say this at the risk of sounding hyperbolic,” Moody’s chief economist Mark Zandi wrote in an X post in September. “This is among the best performing economies in my 35+ years as an economist.”

In September, the Federal Reserve cut interest rates for the first time in over four years as the inflation rate neared its 2% target, marking a major milestone in the U.S. economy’s post-pandemic recovery.

The consumer price index hit a peak of 9.1% in 2022, the highest in roughly 40 years. The CPI has since cooled significantly, falling to 2.5% year-over-year in August.

As consumer prices simmer down, productivity is heating up, with real gross domestic product increasing at a 3.0% annualized rate in the second quarter. That could set Biden up to notch the highest average rate of productivity growth since the Clinton administration.

“This is the economic expansion that economists were afraid to hope for,” said Justin Wolfers, a professor of public policy and economics at the University of Michigan. “But it’s happening, and it’s amazing.”

Over the past few months, the stock market has also hit new records on an almost regular basis. Following the jobs report blowout, the Dow Jones Industrial Average closed out last week at a fresh all-time high of 42,352.75. The S&P 500 and the Nasdaq Composite also ended the day rallying.

Recession hawks, as a result, have stopped stoking fears. And some companies are raising their earnings guidance.

On Sept. 26, chipmaker Micron Technology said it expected to bring in $8.7 billion in first-quarter revenue, higher than analysts’ $8.3 billion estimate. And cloud-computing company Oracle hiked its own revenue guidance, expecting to generate $66 billion in fiscal 2026, $1.5 billion more than it previously projected.

The so-called Misery Index, which looks at a combination of the inflation rate and the unemployment rate, is at nearly the lowest level of any presidential cycle in the last 50 years, according to an analysis by Wolfers.

The slew of strong data undermines Trump’s message to voters, that the Biden-Harris administration has destroyed the economy, said Teddy Goff, digital director for Barack Obama’s re-election campaign in 2012.

“Everyone can see with their two eyes that the economy is booming,” Goff said.

Consumer sentiment jumped for the second month in a row in September, reaching its highest mark since May, according to the University of Michigan’s latest survey released Sept. 27.

CNBC contacted the Trump campaign for this story, but national press secretary Karoline Leavitt ignored questions about the positive economic news.

“Kamala Harris and Joe Biden have built back broke,” Leavitt wrote in a statement. “But President Trump has a plan to make America the manufacturing superpower of world and protect American jobs here at home.”

But Stephanie Kelton, a professor at Stony Brook University, said it was hard to imagine many voters looking for better headlines.

“When you turn on the radio or pick up a newspaper, you’re more likely to see positive news about where the economy is,” Kelton said. “There’s a vibe shift.”