Mixed Reviews on Economy’s Direction in 2026, Phased Retirement

Hey, everybody, it's Gene Marks, and welcome to this week's episode – the first episode of 2026 – of the Week in Review, a Paychex THRIVE podcast. This is where we take a few items and news that are happening and how they impact your small business and mine.

Now, before we start, imagine – just imagine – if there are two of you managing your business. Think about how much more you could achieve. Now, while that may be possible there is a way to lighten your workload. That’s where Paychex comes in. They’ve got the tools and the expertise to handle the day-to-day essentials from payroll to HR and employee benefits. So, to see how Paychex make a difference for your business, head to paychex.com/meetpaychex. That’s P-A-Y-C-H-E-X dot-com forward slash meet paychex – M-E-E-T-P-A-Y-C-H-E-X. You can also find the link in our show notes. Check it out today.

All right, let’s get to the news, shall we?

The first news comes from FOX Business, and it’s a projection of the 2026 economy. The headline is “the U.S. economy is expected to grow faster in 2006 despite a stagnant job market.” Goldman Sachs economists project that the U.S. economy will accelerate in 2026, forecasting real GDP growth for about 2.6%, surpassing current consensus expectations.

They argue the stronger expansion will occur even as the job market remains sluggish, with unemployment likely to stay elevated and hiring week. Key factors driving the outlook reduced tariff drag, which had previously weighed on growth in 2025, significant tax refunds, and cuts that are going to boost consumer disposable income, and improving financial conditions supported by anticipated Federal Reserve rate cuts.

Goldman Sachs notes that about an extra $100 billion in tax refunds is expected to reach households in 2026, stimulating spending. Business investment will also benefit from full expensing provisions under recent tax legislation. While these elements point towards firmer economic momentum, the labor market is not expected to strengthen significantly. Cooling in employment and a rise in the unemployment rate through late 2025 suggest continued slack. However, inflation is seen moderating somewhere – somewhat – as tariff impacts fade and other price pressures ease.

Overall, Goldman's forecast paints a picture of solid growth alongside persistent labor market weakness. So good news for the economy in 2026, we will find out.

Now, not so good news so far as we end in 2026. This is a report that comes from the American Trucking Association – that's trucking.org – truck tonnage, it has to do with that. The American Trucking Association's for-hire truck tonnage index recorded a 0.2 % increase in November 2025, signaling a modest rise in U.S. freight volumes hauled by trucks compared with October's figures. This is a really important metric to follow.

The slight uptick followed notable declines in earlier months and reflects broader weakness in freight demand. While the index edged higher, tonnage remained flat or slightly below year ago levels, indicating that overall transportation demand has not strengthened meaningfully.

Analysts categorize November’s gain as tentative, a small sequential improvement rather than evidence of robust expansion in the trucking sector. The American Trucking Association’s tonnage measure is closely watched as an economic barometer because trucking accounts for a majority of freight moved domestically and tends to reflect shifts in manufacturing, retail, and inventory spending.

Despite November’s modest rise, challenges such as muted demand and a constrained shipment volumes persisted, hinting at lingering soft spots in the logistics and goods distributions markets. The November result, along with recent volatility and monthly tonnage readings, underlines an uneven freight market that has struggled to build sustained momentum amid broader economic headwind.

So, good news from Goldman Sachs looking forward to 2026 but some concerning news from the American Trucking Association about freight volumes.

Finally, we have a report from fortune.com about America's aging demographic and its impact on the labor market that I thought would interest you. Fortune highlights how America's aging demographics are reshaping the workforce as more people turn 65 than ever before, a trend expected to persist through 2027.

This surge in retirement is creating a talent and leadership gap for employers exasperated by decades of declining birth rates that have resulted in fewer younger workers entering the job market. The article emphasizes that traditional notions of retirement – a sudden departure from work – are increasingly outdated.

Instead, companies are encouraged to adopt phased retirement approaches, allowing experienced workers to gradually reduce hours and their responsibilities while continuing to contribute their knowledge and mentor less-experienced staff. Such arrangements help organizations remain critical institutional expertise, support more succession planning, of course, and will help you engage your employees and mitigate looming labor shortages.

Employers that adapt these policies, according to the fortune.com article, incorporate flexible retirement options, training, and knowledge transfer can better navigate demographic shifts with maintaining competitiveness and support both organizational needs and worker preference.

So, Fortune, just giving some advice and some warnings to employers that a lot of people are retiring over the next few years and that will put pressure on our labor workforce. They offer some thoughts on how to mitigate that.

That's the interesting news that affects your business and mine this week. And, by the way, if you need any help or advice or tips in running your business, and you would like to see some prior episodes of this podcast, sign up for our Paychex THRIVE newsletter. Go to paychex.com/thrive.

My name is Gene Marks. I want to thank you so much for joining me. We will see you again next week on another episode of the Paychex THRIVE Week in Review. Take care.

Do you have a topic or a guest that you would like to hear on THRIVE? Please let us know. Visit payx.me/thrivetopics and send us your ideas or matters of interest. Also, if your business is looking to simplify your HR payroll benefits or insurance services, see how Paychex can help. Visit the resource hub at paychex.com/worx. That's W-O-R-X. Paychex can help manage those complexities while you focus on all the ways you want your business to thrive.

I'm your host, Gene Marks, and thanks for joining us.

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