Voters Face High Prices and Slowing Hiring Ahead of Midterms

Shoppers face higher costs for fuel and goods as the federal government releases final economic data before the November 3 midterm elections. Gasoline prices have climbed sharply, and consumer confidence has dropped to historic lows despite continued economic expansion.

The average price of a gallon of regular unleaded gas reached $4.22 on Thursday. That figure is $1.19 higher than the price recorded one year ago. Diesel fuel costs an average of $6.33 per gallon, representing a $2.65 increase from the same period last year, according to AAA data.

Federal statistics show prices rose at an annual rate of 3.7% in September. This rate exceeds the Federal Reserve's 2% target by more than one percentage point. Wages have not kept pace with these increases. Paychecks began trailing inflation in April, reducing the spending power of workers.

Consumer sentiment currently sits at the second-lowest level in the 74-year history of the University of Michigan monthly survey. The latest data released last week indicates that shoppers expect inflation to rise further over the next year. A poll by ABC News, The Washington Post, and Ipsos found that at least half of Americans described every measured household purchase category as unaffordable.

Seventy-one percent of respondents in that poll called gasoline unaffordable. That number is up from 28% in February, before the war in Iran drove up fuel costs. The conflict has contributed to the current inflationary pressure, squeezing household budgets.

President Donald Trump addressed the economic conditions at a rally in Corinth, Mississippi, on Monday. He described the U.S. economy as experiencing "unbelievable growth, the biggest growth in the history of our country." He acknowledged the rise in oil prices but stated the war with Iran was necessary to prevent a nuclear weapon.

"I don't want to belittle it because it's a big thing but I thought the price of oil was going to go much, much higher and I was fully prepared to do it," Trump said.

The economy expanded at an annualized rate of 3.4% over the three months ending in September. This marks an acceleration from 2.2% growth in the first quarter and 2.5% in the second quarter, according to the U.S. Commerce Department. A surge in spending on artificial intelligence contributed an average of 0.56 percentage points to GDP growth in those first two quarters. That sector accounted for more than 20% of economic growth, a study by J.P. Morgan Asset Management found.

Consumer spending, which drives about two-thirds of economic activity, rose 0.9% in August. This was the fastest monthly increase since March. The labor market added an average of 68,000 jobs per month during the first nine months of the year. This pace is an uptick from the 10,000 jobs added monthly in 2025, according to an analysis by the Atlanta Federal Reserve.

Monthly job gains have fluctuated significantly. Employers added 29,000 jobs in September, down from 133,000 in August and a loss of 10,000 in July, Bureau of Labor Statistics data showed. The yearly unemployment rate has remained at 4.4% or lower since 2017, excluding the pandemic years of 2020 and 2021.