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Donald Trump’s astonishing return to the White House has provoked a range of reactions including excitement, fear, anticipation, and a good deal of chin stroking about what exactly he is going to do over the next four years.
Among the many threads that are being discussed from economic strategy to foreign policy, are his anticipated policies for the job market, worker protection, and the economy at large. His previous term provided a taste of his economic priorities, and, of course, it will come as no surprise if he implements similar strategies with renewed vigor in his second term.
He is characteristically hard to second guess but based on what he said in his run to the White House, here is what his return as president might mean for American jobs, wages, worker rights, DEI initiatives, and employee benefits in various sectors.
Wages and worker protection
During Trump’s previous term, his administration took steps to deregulate several labor protections, aiming to reduce costs for employers. His stance against a federal minimum wage increase was notable, and it remains uncertain if he will support such an initiative moving forward. Although he previously stated openness to a $15 minimum wage if it doesn’t harm small businesses, when questioned he has deliberately swerved committing to any such increase.
Regarding workplace rights, Trump has proposed significant changes to the National Labor Relations Board (NLRB), which could shift the board’s stance in favor of employers. According to employment law experts, Trump is likely to undo rule changes made under Biden and replace NLRB personnel to align with his administration’s pro-business stance. This shift could limit workers’ abilities to collectively bargain and reduce protections that were enhanced under the previous administration.
Diversity, Equity, and Inclusion (DEI) in the workplace
Trump’s approach to DEI initiatives is not likely to be positive, especially in education and federally funded programs, where a shift away from the DEI priorities emphasized by his predecessor is expected.
A well-documented critic of diversity programs, he is likely to double-down on the opposition to DEI which has seen many corporations pull back from their commitments in recent months.
He has pledged to refocus US educational institutions on "American tradition and Western civilization" while potentially removing or minimizing diversity programs in federal institutions. Expect greater scrutiny of federal funding for educational DEI initiatives and the elimination of diversity training in government agencies, which could have a knock-on effect on corporate DEI programs.
Corporate DEI initiatives largely expanded under Biden's tenure; however, companies relying on federal contracts may need to revisit their policies to ensure compliance with forthcoming guidelines from the Trump administration.
Employee benefits and tax
Trump’s stance on employee benefits includes a controversial proposal to eliminate taxes on tipped wages (also supported by the Democrats), which could affect millions of US workers. While it may benefit tipped employees in certain sectors, it could potentially create challenges if more industries move towards a tipping model such as a drop in salary. It could also reduce tax revenue, affecting public programs that rely on federal funds.
Healthcare benefits may also be affected. Trump has previously pushed for repealing the Affordable Care Act, which may again be a priority. Employers could see shifts in healthcare plan requirements if changes to ACA provisions are enacted, impacting employer-sponsored health insurance options for workers. Given the complexities and political implications of healthcare reform, however, any significant changes to employer health benefits would possibly face substantial legislative hurdles.
Trump’s apparent choice of vaccine sceptic Robert F. Kennedy Jr. to head up the drug and food agencies has raised some eyebrows. Although he seems to have stopped short of the idea of putting him in charge of the Department of Health and Human Services.
Kennedy has promoted unproven theories about the dangers of childhood vaccinations and has espoused the debunked idea that they cause autism.
“Robert F. Kennedy cares more about human beings and health and the environment more than anybody,” Trump said. “I’m going to let him go wild on health, I’m going to let him go wild on the food, I am going to let him go wild on medicines.”
All bets are off on how that unfolds, and what knock-on effects it could have for employers.
Education and training
In education, Trump has stated his intention to reduce federal involvement, even suggesting the abolishment of the federal Department of Education, to shift the responsibility of schooling entirely to state governments. His approach includes support for alternative schooling options, such as private and religious institutions, which could affect workforce training and development pathways if federal funding and oversight decrease.
The Trump administration is also expected to renew a focus on vocational training, potentially creating more pathways into trade fields like manufacturing and construction. The broader impact on workforce development, however, particularly in high-tech and service sectors, remains unclear as federal involvement in education policies might reduce federal funding for STEM and other programs essential for these industries.
Jobs and the economy
One of Trump’s signature proposals is to implement a 10% or higher tariff on all US imports, aiming to eliminate the trade deficit and boost US manufacturing. While intended to stimulate domestic production, critics argue that such tariffs may lead to higher prices for consumers, reduced trade, and potential job losses in import-reliant industries.
According to economists, increased tariffs often result in supply chain disruptions, pushing up costs for manufacturers who rely on imported goods. This, in turn, can make American-made products more expensive, impacting both consumers and job growth. In addition, he has touted a tariff of up to 60% on Chinese imports, which would push up prices for manufacturers that rely on Chinese components and raw material and would likely be passed on to consumers already struggling with the high inflation which was one of the key factors influencing voters to choose Trump.
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Trump’s focus on fossil fuel energy production could generate some jobs in the oil, gas, and coal sectors, but is likely to have a negative effect on the renewable energy sector. His “drill, drill, drill” approach, aiming to open federal lands for new fracking projects, may reshape the labor landscape in energy. Experts caution, however, that while fossil fuel jobs may expand, renewable energy job growth could stall if government support and investment shifts focus.
Immigration and labor supply
His flagship policy is reducing immigration. Specifically, from the southern border. Trump’s immigration policies could impact industries reliant on immigrant labor, such as agriculture, construction, and hospitality. He ran on a ticket that promised to significantly ramp up deportations and has proposed using the 1798 Alien Enemies Act to remove people. Critics, including leaders from the construction and housing sectors, have expressed concern that mass deportations could exacerbate existing labor shortages.
The National Association of Home Builders, for example, has noted that undocumented workers constitute around 13% of the US construction workforce, according to Pew Research Center data. Trump would no doubt argue, however, that a sector should not be reliant on illegal labor to succeed.
That said, the reality is that for a construction industry already facing a workforce shortage, further reducing the labor pool could hinder growth and drive-up housing costs.
Reflections for HR
The impact of Trump’s policies on jobs, worker rights, DEI, and the economy is expected to be multifaceted and dependent on how swiftly and extensively the proposed changes are enacted.
He is not a typical politician in many regards, but he conforms to the norm by often talking a better game than he plays. In other words, he may not follow up on some of his commitments.
While his approach is business-focused, aiming to reduce regulatory oversight and stimulate economic growth, certain sectors may face challenges, particularly those reliant on immigrant labor. The anticipated onslaught on DEI initiatives will impact workplace culture and practices in both public and private sectors.
All that said, at this early stage, with his administrative picks still to be made, nothing is yet clear and the central theme of the new Trump administration, as it was with the first, is that nobody can be entirely sure of anything.
Karetnick Benjamin