Economists are heading into 2026 with a surprisingly upbeat baseline after 2025’s tariff shocks and shutdown disruptions. Goldman Sachs forecasts 2.6% real GDP growth in 2026 versus 2.0% consensus, helped by fading tariff drag, easier financial conditions, and an estimated $100B boost in tax refunds in H1, per Goldman’s 2026 outlook.
The immediate catalyst for this shift in tone is that key 2025 headwinds are no longer accelerating. Goldman estimates the average effective tariff rate rose 11pp in 2025 and shaved about 0.6pp from GDP in the second half. If tariff rates stay broadly stable, that drag should fade in 2026, while business tax provisions and prospective Fed cuts help activity.
Still, the labor market is the swing variable. Goldman expects unemployment to hover around 4.5% in 2026 after rising to 4.6% in November, and warns it could rise further if productivity-enhancing AI adoption comes faster or companies refocus on cutting labor costs, per the same forecast. That aligns with Bank of America CEO Brian Moynihan’s view that labor availability and planning uncertainty matter more than tariffs right now, while he also cautioned markets would react badly if the Fed’s independence is questioned as the chair transition approaches in May 2026, according to his CBS interview.
Next steps come quickly. Investors get another read on policy divisions via the Fed’s December meeting minutes, and macro watchers will keep triangulating between consumer resilience and labor cooling. The big risk is a policy mix that tightens labor supply while tariffs and AI keep cost and job anxieties elevated. Position for a 2026 base case of steady growth, but don’t ignore the labor-market tail risk.
