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Trump Promised Job Creation — but His Budget Axes Many Job Creation Programs

Donald Trump ran for president on a platform of creating good jobs for American workers, but his inaugural budget would siphon resources away from many of the people and programs that do just that.

The proposal features sharp cuts in discretionary spending, many of which would hit job creation and training initiatives — not to mention the potential loss of tens of thousands of federal positions.

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"The maximum is probably around 50,000 potential jobs lost, but the dollar cuts are first going to hit on peripheral, marginal programs," said Jeff Strohl, director of research at Georgetown University's Center on Education and the Workforce. "A more realistic number would probably be 10,000 in the near term, and 15,000 to 20,000, long term."

Some of these reductions would hit agencies whose staffing budgets had already been "cut to the bone," he said.

More vulnerable populations could be at even greater risk.

Importance of an Older Workforce

"It would be absolutely devastating," said Bob Harootyan, manager of research at Senior Service America, Inc. The organization runs the $434 million Senior Community Service Employment Program, a job-training program that serves around 70,000 low-income senior citizens, paying them minimum wage while training them for primarily part-time community service jobs in places like public libraries.

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According to the budget, "SCSEP is ineffective in meeting its purpose of transitioning low-income unemployed seniors into unsubsidized jobs. As many as one-third of participants fail to complete the program and of those who do, only half successfully transition to unsubsidized employment."

Harootyan said this metric doesn't account for the people who drop out of the program because they die, or need to either receive or provide a spouse with full-time caregiving.

"Their economic security makes a large difference," Harootyan said. "When we look at the average they earn — a $600-a-month income — it makes a dramatic difference in their lives," he said.

"It is really an important area of support when people do need to work longer," said Jacquelyn James, co-director of the Boston College Center on Aging & Work, pointing out that the number of people between 65 and 69 remain in the labor force is rising.

The proposed budget cuts affect more than seniors: It would take the axe to regional economic development agencies in Appalachia, the Deep South, Alaska and New England.

"DRA has invested $163 million into more than 1,000 projects that have partnered with other public and private investments for a total of $3.3 billion," Delta Regional Authority federal co-chairman Chris Masingill said in a statement. The Authority covers parts of Alabama, Arkansas, Illinois, Kentucky, Louisiana, Mississippi, Missouri and Tennessee. "Those investments have helped to create and retain more than 26,000 jobs," he said.

Training Programs Axed

Programs to train healthcare workers and teachers would be abandoned, and other cuts would eliminate the Economic Development Administration and the Minority Business Development Agency, both of which fall under the purview of the Commerce Department, which defended the budget decisions.

"By eliminating duplicative programs like EDA, the administration will be able to fulfill the key priorities of maintaining our national security, spurring job growth, and creating opportunity for all Americans," a Commerce spokesman said in a statement.

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But worker advocates say this is a betrayal of the working- and middle-class voters Trump pledged to champion. "The Trump budget would gut the very job training programs workers need to develop the skills required to compete in emerging fields," Christine Owens, executive director of the National Employment Law Project, said in a statement.

And the long-term economic effects of these decreases could be even greater than the sum of their parts, one former administration official warned. "When those programs are cut, that will have an overall detrimental effect," said Heidi Shierholz, director of policy at the Economic Policy Institute and former chief economist at the Department of Labor. "We'll not be making the important investments we need for productivity growth."