Jobs at greatest risk under potential future Trump administration
It's still uncertain which of Trump's plans will be executed. He's promised widespread deportations of individuals who illegally entered the country and broad, worldwide tariffs on all imported goods. The consequences for the American labor force are substantial.
Certain industries could experience job growth due to his policies. For example, more stringent tariffs could result in an increase in domestic manufacturing jobs if businesses opt to produce their goods locally to avoid the added cost of imports. A representative from the Trump-Vance transition team informed CNN that Trump is determined to replicate "his first term's successes," such as "historic job growth for typical Americans."
(Despite historically low unemployment rates throughout much of Trump's first term, the economy experienced significant job losses during the pandemic. Consequently, when he left office, fewer Americans were employed compared to when he assumed office.)
Nevertheless, some industries could be compelled to lay off workers due to new policies Trump may enact into law.
The vulnerable sectors include:
Energy sector
Businesses involved in exporting goods to overseas markets could potentially face workforce reductions if Trump fulfills his tariff threats, said Harry Holzer, a public policy professor at Georgetown University and a nonresident senior fellow at the Brookings Institution.
Countries responding to being subjected to higher tariffs by imposing similar tariffs on American goods could significantly increase American businesses' costs and reduce demand for their products. This was evident during Trump's first term when China retaliated with tit-for-tat tariffs on American imports.
Given that oil is America's primary exported product, according to 2023 federal trade data, firms in this sector would likely need to offset costs by downsizing their workforce if other nations impose retaliatory tariffs on U.S. goods.
This could put at risk employees involved in oil and gas extraction, such as mining and geological engineers and personnel working on oil rigs.
Similarly, workers in the chemical, automobile, transportation part, and electronics industries could be endangered, as these sectors also account for some of the top U.S. exports, according to Holzer, a former chief economist at the Department of Labor.
Government sector
Elon Musk and Vivek Ramaswamy, who are spearheading initiatives to reduce government spending through Trump's newly established Department of Government Efficiency (DOGE), have advocated for the dismissal of federal government employees.
In fact, Musk shared two X posts that highlighted the names and positions of individuals in four relatively obscure climate-related government positions he believes should be eliminated.
Musk and Ramaswamy stated that the number of federal employees to dismiss should be proportional to the number of federal regulations that are revoked.
In Holzer's opinion, employees in the Justice Department and the Education Department (which Trump has advocated for eliminating altogether) face more significant layoffs compared to those in defense-related agencies.
Renewable energy sector
As a climate change skeptic, Trump is expected to reverse some of the green energy initiatives implemented by the Biden administration. This could include reducing incentives and subsidies for businesses producing electric vehicles and lithium-ion batteries.
Both industries have become dependent on federal investments the Biden administration successfully secured. Without these investments, workers "would find themselves on the chopping block fairly quickly," according to Holzer.
For instance, last month, the Department of Energy provided a $6.6 billion conditional loan commitment to Rivian, an electric vehicle startup that competes with Tesla, Musk's $1 trillion automotive company.
Ramaswamy indicated that this loan and others like it are "high on the list of items" that he will seek to recoup when DOGE becomes operational next year. (Tesla received a similar DOE loan for $465 million in 2010, providing it with crucial funding ahead of its initial public offering of stock.)
Two significant uncertainties
If Trump authorizes widespread deportations, industries relying heavily on undocumented migrant workers, like construction, agriculture, and hospitality, could experience significant labor shortages. This could lead to declining revenues for businesses nationwide, triggering a wave of layoffs, according to Monster Economist Giacomo Santangelo. Lower employment may also negatively impact the overall economy, potentially pushing GDP into a recession. Furthermore, it's unclear how the Federal Reserve would respond to Trump's tariff and immigration policies, both of which could contribute to inflation.
"In the face of inflation, the Federal Reserve is likely to raise interest rates," Santangelo said. This pressure could particularly affect small businesses, which employ half of America's workforce, as they are generally more sensitive to increases in borrowing rates. Consequently, small businesses may be forced to lay off some employees.
The energy sector could face workforce reductions if retaliatory tariffs are imposed on American oil exports due to Trump's tariff threats. This could put at risk employees involved in oil and gas extraction and related industries.
Musk and Ramaswamy, spearheading initiatives to reduce government spending, have advocated for the dismissal of federal government employees, particularly in the Justice Department and the Education Department.
