An analysis of current data releases as of September 5, 2025, reveals that the U.S. economy is showing signs of stalling.
U.S. real GDP rose 3.3% in the second quarter, according to the second estimate from the U.S. Bureau of Economic Analysis. Each quarterly estimate is revised in the two months following the initial release. Growth in the second quarter was up from a 0.5% drop in the first quarter. Stronger growth in the second quarter reflected reduced imports and a solid increase in consumer spending. Investment spending declined, reflecting strong inventory decumulation, as well as lower levels of residential and nonresidential building. Offsetting movements in imports and inventories likely reflect firm responses to tariffs. Nominal corporate profits were up 1.7% over the quarter in the second quarter, after a 2.3% drop in the prior period. -George Hammond
The U.S. unemployment rate changed little in August at 4.3%, while total nonfarm payroll employment increased by 22,000, according to the Bureau of Labor Statistics’ September 5th employment situation summary. The unemployment rate among major worker groups saw little or no change in August, with teenagers (13.9%) showing the highest unemployment rate. Total nonfarm payroll employment has shown little change since April. Over the month, job gains in healthcare (+31,000) were partially offset by losses in federal government (-15,000) and in mining, quarrying, and oil and gas extraction (-6,000). Losses were also seen in wholesale trade (-12,000) and manufacturing (-12,000), while employment showed little or no change in other major industries. -Delaney O’Kray-Murphy
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The number of job openings in the United States was 7.2 million in July, with a seasonally adjusted rate of 4.3%. By sector, the number of job openings decreased in health care and social assistance (-181,000); arts, entertainment, and recreation (-62,000); and mining and logging (-13,000) according to the most recent Job Openings and Labor Turnover (JOLTS) monthly report from the U.S. Bureau of Labor Statistics. Both hires and separations were unchanged over the month, at 5.3 million and a rate of 3.3%. Within separations, the number of quits (voluntary separations) was 3.2 million, and the number of layoffs and discharges was 1.8 million. The number of quits increased in professional and business services (+197,000) and decreased in construction (-80,000). Layoffs and discharges increased in federal government (+5,000) and decreased in professional and business services (-130,000). -Valorie Rice
In July 2025, 190 of the 387 metropolitan areas in the U.S. posted higher unemployment rates than the year prior. Rapid City, South Dakota, and Sioux Falls, South Dakota-Minnesota, had the lowest rates, at 1.7%. El Centro, California, had the highest at 20.2%. Also in July, 31 areas had unemployment rates below 3.0%. The Phoenix MSA rate was 4.1%. The Tucson MSA rate was 4.7% and the Prescott MSA rate was 4.5%. Nonfarm payroll employment increased over the year in 34 areas and was essentially unchanged in the rest. Phoenix MSA jobs were up 1.2% in July. Tucson MSA jobs were up 0.6% and Prescott MSA jobs were up 0.9%. -George Hammond
Phoenix house prices decreased 0.1% over the year in June based on the most recent S&P Cotality Case-Shiller Indices. Nationally, house prices were up 1.9% over the year, the slowest pace in two years. The 20-city composite had a gain of 2.1% for June, down from 2.8% in May. New York continued to be the metropolitan area with the highest annual gain in prices, at 7.0%, followed by Chicago at 6.1% and Cleveland at 4.5%. Tampa was again the area with the worst performance at -2.4%. Phoenix (-0.1%), Miami (-0.3%), and San Diego (-0.6%) all slipped into negative territory in June, joining Dallas, Denver, San Francisco, and Tampa. -Valorie Rice
Arizona was among four states reporting negative house price changes over the year during the second quarter of 2025, with a decrease of 0.4%. Based on the U.S. Federal Housing Finance Agency (FHFA) House Price Index, house prices rose 2.9% nationally during that period. The state with the highest one-year price appreciation was New York, rising 8.0%, followed by Connecticut at 7.8%. The District of Columbia experienced the most dramatic decrease in house prices, at -7.6%, followed by Florida at -1.4%, Colorado at 0.6%, Arizona at -0.4%, and Vermont at -0.1%. State-level data listed here reflect the purchase-only index. Arizona metropolitan area data are available using the all-transactions index, which includes sales prices and appraisal data. Year-over-year price appreciation for the second quarter of 2025 was 1.4% in Flagstaff, -0.4% in Lake Havasu City-Kingman, 1.7% in Phoenix, 3.0% in Prescott Valley-Prescott, 6.0% in Sierra Vista-Douglas, 0.2% in Tucson, and 5.6% in Yuma. For comparison, the all-transactions data for the U.S. and Arizona for the same period were 3.8% and 1.8%, respectively. -Valorie Rice
The July goods and services trade deficit came in at $78.3 billion, up $19.2 billion from a revised $59.1 billion in June. July exports rose $0.8 billion to $280.5 billion, and imports rose $20.0 billion to $358.8 billion. The increase in the deficit reflects an increase in the goods deficit of $18.2 billion to $103.9 billion and a decrease in the services surplus of $1.1 billion to $25.6 billion. Year to date, the goods and services deficit increased 30.9%, or $154.3 billion, from the same period 2024, with exports and imports rising 5.5% and 10.9%, respectively. The largest surpluses, in billions, were with Netherlands ($4.8), South and Central America ($4.6), and Hong Kong ($1.9), while the greatest deficits were with Mexico ($16.6), Vietnam ($16.1), and China ($14.7). -Delaney O’Kray-Murphy
In July, Arizona over-the-year building permits saw a slight 9.7% decrease to 4,520, not seasonally adjusted. The number of single-family permits fell 29.4% over the year to 2,493, while the number of five or more unit permits surged, rising 52.2% to 1,916. The Phoenix Metropolitan area accounted for most of the permits in the state, with 3,656, a 6.4% increase. Similar to the state, Phoenix single-family permits fell 30.4% to1,744. The Tucson MSA saw decreases in all permit categories, with total permits falling 53.3% to 306, single-family permits falling 29.1% to 256, and five or more-unit permits falling 83.0% from last year. Of the counties, Graham, Maricopa, and Santa Cruz saw increases, while Apache, Cochise, Coconino, Gila, Mohave, Navajo, Pinal, Yavapai, and Yuma saw decreases. No changes were seen in La Paz. -Delaney O’Kray-Murphy
