Trump’s Policies and the Workforce
On the campaign trail, Donald Trump vowed to shake up the status quo and develop millions of new jobs. Now that he’s President Trump, all eyes are on him to bring forward the jobs he promised. Here are some areas that the President will likely take on this year in the labor market.
In 2016, the economy added 2.24 million new jobs and January 2017 marked the 76th consecutive month of job growth. Despite the positive growth and a general consensus that job market is in good shape; candidate, and now President Trump, spent a good deal of time dismissing the jobs reports calling them a ‘hoax’ and citing 94 million unemployed Americans in his recent address to Congress.
So what’s the reality? Economists note that the job market is substantially better than past years, but that labor participation rate and wage increases should be higher to expand the economy. As for the 94 million figure (similar to the one in five comparison he also makes) often shared by President Trump, experts call attention to the fact that of those 94 million, 93% do not want a job and the vast majority are retirees, students, stay-at-home parents or the disabled.
Interestingly enough, President Trump has recently pointed to January jobs report as a sign his plans are working—the same report that he criticized as a candidate. As President, he has early access to the job numbers, so perhaps the President is seeing the large scale pictures the numbers present.
As a business man himself, it’s likely that President Trump will continue to reach out to specific businesses and work with them to save jobs as he’s already done. While every job counts, it may it may take more than a company by company approach to rehabilitate all the job market issues he spoke of as a candidate.
One of the largest policy points in President Trump’s campaign was the promise to repeal and replace the Affordable Care Act, a piece of legislation that impacts millions of employers and their employees. The Republican Party has put forward The American Health Care act, but not surprisingly, many are not in favor of the proposed legislation. The potential repeal and replace process could take over a year, and for now, the Affordable Care Act remains in place through 2018.
Another key piece of the President’s platform was his promise to crack down on legal and illegal immigration policies. On the campaign trail, President Trump stated multiple times that he believes U.S. employers are forgoing domestic workers for foreign hires as a way to get talent at a cheaper price. Trump has called for a higher minimum allowable wage for workers with an H1-B visa, but has yet to follow through on this front.
The other group of people likely to be impacted are immigrants from Mexico and South America. With the administration already cracking down on illegal immigrants, a number of economists have noted that a lowered number of these workers might have a negative impact on the workforce in the coming years. Employers are already feeling the impact of a tightened job market and some experts point to millions of illegal immigrants taking on the jobs that American citizens do not want, especially in hospitality, construction and agriculture.
During his campaign, Mr. Trump vowed to reduce taxes to a fixed 15% rate for businesses – a more than 40% decrease– which he believes will make it more cost effective for companies to conduct business in the U.S., therefore growing the economy and boosting job growth. The administration has yet to submit any pieces of legislation around this, but it’s likely that it will happen this year.
Other Workforce Issues on the Horizon
Minimum Wage: Believes that federal minimum wage should be raised to $10 an hour but supports the right of states to opt for higher wages.
Maternity Leave: Favors a policy that would offer six weeks of paid leave to new mothers following childbirth. This policy would only apply in situations where employers do not offer a plan. Leave would be funded through unemployment insurance. The President’s Daughter, Ivanka is working with Congress on Legislation.
Fair Labor Standards Act: Would add small business exemptions to the recently enacted revision that made an additional 4.2 million employees eligible for overtime pay. The administration has not made any moves on policy change.
H-1B Visas: Called for an increase in the minimum allowable wage rate for workers with the Visa in hopes of boosting domestic hires over foreign talent.
It’s often said that it’s easy to be a presidential candidate, but it’s tough to be President. Regardless of political party, a campaign is filled with promises for the future; as President, your record, actions and results are what you’re held against. America will be watching closely to see what the President achieves in 2017.