During his presidential campaign, Donald Trump talked a lot about the economy. He vowed to bring down the cost of groceries (an “old-fashioned” word with which he was obsessed), revive manufacturing, slash federal spending and inefficiency and distribute the savings to the citizenry, all while achieving energy dominance and the high-paying jobs that come with it.
By early summer, however, it was becoming clear that Trump’s economic policies were not having the promised effect.
Trump’s tariffs only exacerbated the post-COVID inflation that had haunted Joe Biden’s presidency. Prices rose on everything from steel pipe to coffee, while retaliatory trade barriers hurt U.S. manufacturers. The loss of Biden-era grants and loans caused several firms to cancel planned billion-dollar manufacturing facilities, and tourism fell as international travelers began to avoid the U.S. The mass firing of federal employees has further eroded the already-lagging jobs situation, while the mass deportation and harassment of immigrants has sent painful ripples through the West’s construction, agriculture, leisure and hospitality industries.
Across the Southwest, the economic cracks are widening.
Tourism
The administration’s “America First” creed — which often manifests as hostility toward anyone who is not the “right kind” of American — has begun to hollow out the nation’s essential immigrant labor force, hitting the agriculture, construction and service industries especially hard. It’s also discouraged travel from abroad, especially in the Southwest, walloping that region’s tourism sector.
The World Travel & Tourism Council predicted that the U.S. will lose about $12.5 billion in international spending this year, prompting Council President Julia Simpson to warn:
This is a wake-up call for the U.S. government. While other nations are rolling out the welcome mat, the U.S. government is putting up the ‘closed’ sign.
Following a string of record-breaking years for national parks, the number of visitors enjoying America’s “best idea” has dried up this summer, impacting gateway communities, especially in the Southwest, despite relatively low gas prices.
▼ 3.8% Amount that international air travel into the U.S. for January through July declined from the previous year.
▼ 15% Number of Canadian air passengers arriving in the U.S. this August compared to last year.
Trade War Fallout
Trump’s tariffs were supposed to help American businesses by raising costs on imported goods. But the haphazard way in which they’ve been implemented has spawned uncertainty and increased the cost of steel, aluminum, fertilizer and other inputs for American producers, in many cases hurting rather than helping them. Meanwhile, retaliatory tariffs have seriously dampened hay and meat exports from Western states, especially those going to China.
In September, there were 8% fewer drilling rigs operating in Western states than there were a year earlier, an indication of a struggling industry.
“The Liberation Day chaos and tariff antics have harmed the domestic energy industry. Drill, baby, drill will not happen with this level of volatility. Companies will continue to lay down rigs and frack spreads.”
—Petroleum executive in an anonymous response to a Federal Reserve Bank of Dallas survey
▼ 27% Amount that hay exports from California, Arizona and Utah fell over the first seven months of the year, compared to the same period last year.
Clean Energy and Manufacturing
The Trump administration and the GOP-led Congress have been on a rampage against non-fossil fuel energy, clawing back Biden-era funding and incentives for electric vehicles and chargers, clean energy manufacturing, and solar and wind power — both the utility-scale and rooftop kind. In response, companies and states have canceled billions of dollars’ worth of investments, and dozens of planned projects are at risk.
▼ $7 billion Amount in federal funding the Trump administration reclaimed when it canceled the Solar For All program, which would have helped lower-income households install solar.
▼ 11%; 12% Decrease in visitors to Las Vegas in June and July respectively, compared to those months in 2024, resulting in the loss of 4,300 jobs in the metro area in August alone.
▼ 7,300 Number of construction jobs lost in Nevada between January and August of this year.
▼ 4% Decrease in tourism over last year this spring in Grand County, Utah, home to Arches and Canyonlands national parks, despite a predicted 6% increase. Business owners told the Moab Times-Independent that tourism is down, especially from abroad.
SOURCES: National Park Service, Bureau of Labor Statistics, Arizona Tourism Office, Moab Times-Independent, International Trade Administration, University of Arizona Economic and Business Research Center, Las Vegas Convention and Visitors Authority, New Mexico Department of Workforce Solutions, Arizona Mirror, E2, KUER, AgWest Farm Credit, Hay & Forage Grower, USDA Foreign Agricultural Service, Federal Reserve Bank of Dallas, Nevada Department of Employment Training and Rehabilitation. Icons: Freepik / Flaticon
We welcome reader letters. Email High Country News at editor@hcn.org or submit a letter to the editor. See our letters to the editor policy.
This article appeared in the November 2025 print edition of the magazine with the headline “The Trump slump.”
▼ $427 million Amount the Trump administration rescinded in September from a project aimed at building an offshore wind assembly, launch and maintenance facility at Humboldt Bay in Northern California.
▼ 8% Decrease in July passenger volume at Page and Flagstaff, Arizona’s airports — major Southwestern tourism hubs — compared to the same month last year.
▼ 7.5% Decrease in Arizona’s June lodging tax revenues compared to the previous year.
▼ 3,000 Number of manufacturing jobs Arizona has lost since the beginning of the year.
Not long after Trump’s inauguration, the Phoenix area’s booming clean energy manufacturing industry took a big hit: Electric vehicle maker Nikola laid off 855 workers; solar panel manufacturer Meyer Burger closed its factory; battery-storage manufacturer Li-Cycle shuttered its facility; and Kore Power nixed plans to build a $1.2 billion battery factory expected to employ about 3,000 people.
The GOP’s Big Beautiful Bill’s clean energy tax credit phaseout jeopardizes three proposed utility-scale solar projects on public land in Arizona worth an estimated $1.6 billion.
In June, Amprius Technologies abandoned plans to establish a $190 million electric vehicle battery factory in an existing warehouse in Brighton, Colorado.
▼ $38.9 million Decrease in Colorado’s meat-related exports for the first half of 2025 compared to last year.
ConocoPhillips is laying off 25% of its workforce, while Chevron laid off 200 workers in the Permian Basin this spring.
▼ $66 million Projected decrease in New Mexico oil and gas revenues in the next fiscal year compared to 2024, thanks to low oil prices and a drilling slowdown.
▼ 5.2% In New Mexico — the nation’s second largest oil producer — the unemployment rate shot up from 3.5% in April 2025 to 5.2% in July, a possible indication of trouble in the oil patch.
Republish our articles for free, online or in print, under a Creative Commons license.
