Former Trump Adviser Gary Cohn Explains How Tariffs Are Making Job Searches Harder

US President Donald Trump’s former economic adviser Gary Cohn has warned that tariffs are raising business costs, which in turn is impacting the job market.

Cohn highlighted that companies feel pressure from rising input prices, but they avoid raising prices for customers. This leaves them with one option.

“The one lever they can pull to make sure they keep their margins intact is they can cut down on the cost of labour,” Cohn said in an interview on the CBS News show 'Face The Nation'. According to him, this may be a reason job searches have become harder.

In August, the US only added 22,000 jobs, down from 79,000 in July, according to federal data. Fed Chair Jerome Powell has also acknowledged that “kids coming out of college and younger people, minorities, are having a hard time finding jobs.”

Cohn said the current trend is a shift from the Covid era, when companies rushed to hire.

“We came out of a tough situation in Covid where companies were actually afraid of being able to attract and retain people, so they were hoarding labour,” Cohn said. “So we went from a hoarding labour situation to a situation today where companies are being very aggressive about managing their expenses, and the one expense they can manage is the cost of labour," he said.

However, when The Fortune approached the White House for a comment, its spokesman Kush Desai said that tariffs under President Trump had brought trillions in US investment. He said the goal was to build more in America and hire more Americans.

The administration is implementing measures like tax cuts and fewer rules, but layoffs continue to happen, particularly in the tech sector. Big firms like Google, Microsoft, and Meta have cut jobs, and many others have followed. This year, almost 90,000 tech workers lost their jobs in just 204 companies, according to Layoffs.fyi.

Cohn noted that while Americans face longer job hunts, companies are thriving. He pointed out that corporate revenues rose 6.3% and profits surged. Still, data shows the job market is weakening.

Cohn served as director of the National Economic Council during the first Trump administration. Currently, he is vice-chairman of IBM and believes the job cuts have begun to impact the economy too.