Trump is making it easier for federal contractors to discriminate—and it will be underwritten by your tax dollars
Since returning to office, the Trump administration has gutted the Office of Federal Contract Compliance Programs (OFCCP)—which has long ensured that employers conducting business with the federal government comply with equal employment opportunity laws. This has made equal employment laws effectively unenforceable for the entire civilian federal contracting workforce.
What’s happening?
In January, President Trump issued Executive Order (EO) 14173 that drastically cut OFCCP’s enforcement oversight and ended affirmative action requirements for federal contractors established by President Lyndon B. Johnson in 1965. In a total about-face from six decades of leveraging the purchasing power of the federal government to encourage private-sector employers to adopt more equitable employment practices and establish written affirmative action programs for women and minorities, Trump’s executive order explicitly discourages any efforts to remedy racialized or gendered patterns of discrimination in employment or pay. Instead, it derisively and inaccurately labels such efforts as “DEI-based discrimination”, implying that they result in workers of color and women unfairly displacing more qualified (assumptively white male) candidates.
Recently, the agency proposed regulations to further unwind its own work and authority. One of the proposed rules would formally rescind the regulations implementing President Johnson’s original EO to establish the agency’s existence and authority. Another would risk weakening data collection on whether federal contractors are meeting “utilization goals”—benchmarks for evaluating the representation of people with disabilities in the federal contracting workforce. These actions showcase the Trump administration’s embrace of Project 2025’s anti-worker and anti-equity agenda, which included a policy proposal to eliminate OFCCP.
Trump’s 2026 budget formally requests Congress to defund OFCCP’s operations. If Congress were to agree to zero out OFCCP’s budget—and if the regulatory unwinding of the agency’s primary mandate proceeds without obstacles—there would no longer be any federal agency dedicated to ensuring that federal contractors operate fair, nondiscriminatory workplaces. In other words, taxpayer dollars could essentially subsidize persistent discrimination. Under the Trump administration’s plans, OFCCP’s remaining legal responsibilities to enforce equal employment opportunity for certain veterans and for workers with disabilities would shift over to the Department of Labor’s (DOL) Veterans Employment and Training Service (VETS) or to the Equal Employment Opportunities Commission (EEOC)—agencies with different mandates and areas of expertise than the federal contracting workforce.
In one promising sign, fortunately, the Senate Appropriations Committee recently voted to advance a bipartisan funding proposal that rejected the Trump administration’s request to zero out OFCCP’s budget. It remains to be seen how appropriators in the House or the Trump administration will respond.
Shuttering the OFCCP will hurt Black and women workers the most
As a relatively small DOL division, OFCCP’s work has gone largely unnoticed by the broader public even though it has achieved important results for workers. According to historical data that the Trump administration removed from the OFCCP website, OFCCP conducted reviews at contractor sites employing over 10.3 million workers between 2014 and 2024. OFCCP investigations resulted in 250,900 workers obtaining financial relief totaling $260.8 million during that period—and over 22,600 individuals employed by federal contractors received new job opportunities or salary adjustments.
Table 1 presents historical monetary relief data by class, revealing the groups most likely to be harmed by Trump’s actions. Black workers and women received most of the monetary relief resulting from OFCCP investigations between 2020 and 2024, demonstrating just how targeted the impact of Trump’s executive order will be.
Stripped of its authority and with only minimal staff remaining, OFCCP’s only remaining equal employment compliance oversight is for disabled workers under Section 503 of the Rehabilitation Act (Section 3) and protected veterans under the Vietnam Era Veterans’ Readjustment Assistance Act (VEVRAA). However, as Table 1 shows, no more than 0.1% of monetary relief resulting from OFCCP investigations over the past five years was awarded based on disability or veteran status.
Trump's dismantling of the OFCCP will hurt Black and women workers the most: Distribution of Office of Federal Contract Compliance Programs (OFCCP) monetary relief by class, 2020–2024
| Class | FY 2020 | FY 2021 | FY 2022 | FY 2023 | FY 2024 |
|---|---|---|---|---|---|
| Women | 23.4% | 29.4% | 30.8% | 42.6% | 15.0% |
| Black | 63.8% | 38.6% | 53.0% | 42.1% | 79.0% |
| Hispanic | 2.4% | 1.4% | 0.2% | 1.8% | 2.7% |
| Asian/Pacific Islander | 2.8% | 7.5% | 7.8% | 1.7% | 0.0% |
| Native American | 0.0% | 0.0% | 0.8% | 0.4% | 0.2% |
| Unknown Minority Group | 0.0% | 0.0% | 0.0% | 0.0% | 0.3% |
| Disability | 0.0%* | 0.1% | 0.0%* | 0.0%* | 0.0%* |
| Veteran | 0.0% | 0.0%* | 0.0%* | 0.0%* | 0.0%* |
| Total Class Members | 68,695 | 21,971 | 9,890 | 13,861 | 9,679 |
Notes: Percentages reflect the distribution of monetary relief across classes. "*" indicates that while the percentage of class members to the nearest tenth rounded to 0.0, there were between one to five beneficiaries in this class for a particular year, representing less than 0.05%. Percentages do not sum to 100% because classes are not mutually exclusive, and pay discrimination cases related to discussing compensation at work may not include any of the classes listed above.
Source: Archived Department of Labor website, "Discrimination Cases Completed (Compliance Evaluations and Complaint Investigations)" [excel table]. Archived January 23, 2025.
While there are no public data on the demographic composition of workers employed by federal contractors, current labor force demographics illustrate the potential magnitude of those changes. Figure A shows the share of the labor force by race, ethnicity, and gender that is either disabled or a veteran. Among Black workers—the largest share of monetary relief recipients—less than 8% of Black women and 13% of Black men would be eligible for monetary relief based on disability or veteran status alone. Across all racial groups, a smaller share of women than men would remain eligible.
Disabled and veteran share of the civilian labor force by race and ethnicity and gender, 2024
| Women | Men | |
|---|---|---|
| White | 6.9% | 14.4% |
| Black | 7.8% | 12.9% |
| Hispanic | 4.8% | 6.9% |
| Asian | 3.4% | 5.0% |
| Other | 11.1% | 20.5% |
Note: Race and ethnicity are mutually exclusive. Counts are limited to individuals 16 years and older and in the labor force.
Source: Author's analysis of Current Population Survey basic monthly microdata from EPI Microdata Extracts, Version Version 2025.6.11, https://microdata.epi.org.
According to the U.S. Government Accountability Office, the federal government obligated $755.1 billion through contracts in 2024 to procure products and services ranging from aircraft and software to health care and engineering support. The planned elimination of OFCCP represents the Trump administration’s surrender of this tremendous federal leverage to enforce nondiscrimination compliance among private-sector employers. It is also a major shirking of the federal government’s responsibility to demand accountability from businesses who profit from billions in taxpayer dollars, including tax dollars paid by people they now have a lot less obligation to employ and pay fairly. This would be a clear retreat from the principles of economic, racial, and gender justice which are the basis for equal rights and full participation in our society. The American people deserve better.
Weak jobs report may signal a coming recession: Average job growth just 35,000 over the past three months
Below, EPI economists offer their insights on the jobs report released this morning, which showed 73,000 jobs added in July.
From EPI senior economist Elise Gould:
Big news in today’s #jobs report are the revisions. The labor market is much weaker than originally reported the last two months. While payrolls grew 73k in July, May and June data were revised down a total of 258k to 19k and 14k, respectively, bringing 3-month average growth down to 35k.
#EconSky— Elise Gould (@elisegould.bsky.social) Aug 1, 2025 at 7:46 AM
Health care jobs grew the strongest in July. Private-sector job losses were reported in professional and business services, manufacturing, and wholesale trade. The surprising uptick in state and local government jobs for June was revised down as federal jobs continued to fall in July.
#NumbersDay— Elise Gould (@elisegould.bsky.social) Aug 1, 2025 at 8:01 AM
Federal cuts continue to cost jobs as federal employment fell another 12k in July. Federal employment is now down 84,000 since January. The latest federal UI claims data for mid-July shows the economic pain continues and the full extent of the job losses won’t be seen until we get data for October.
— Elise Gould (@elisegould.bsky.social) Aug 1, 2025 at 8:11 AM
From EPI chief economist Josh Bivens:
To me, today’s jobs report is what entering a recession looks like. Could we pull up? Sure. But if we look back and end up dating an official recession that starts 3-6 months from now, this is what it would look like today – rapid softening/deterioration in the labor market.
— Josh Bivens (@joshbivens-econ.bsky.social) Aug 1, 2025 at 7:41 AM
From EPI president Heidi Shierholz:
Whoa, the jobs numbers are really bad. With the new July numbers and revisions to May/June, the avg monthly job growth of the last 3 months is 35,000. As Josh says, if we were entering a recession, this is what it would look like.
— Heidi Shierholz (@hshierholz.bsky.social) Aug 1, 2025 at 7:47 AM
Trump’s war on immigrants shows up clearly in the data: the age 16+ immigrant popn has dropped 3.8%—1.9 million—since January. It’s a moral catastrophe, and an economic one. Deporting 1 million immigrants per year will cost ~6 million jobs over Trump’s term.
www.epi.org/publication/…
— Heidi Shierholz (@hshierholz.bsky.social) Aug 1, 2025 at 8:19 AM
D.C. Council should support tipped workers by maintaining I-82: There is no evidence that the policy is harming the restaurant industry in the District
The D.C. Council is debating watering down or eliminating Initiative 82 (I-82), a law passed overwhelmingly by D.C. voters in 2022 that gradually phases out the subminimum wage for tipped workers through 2027. The D.C. Council has already postponed wage increases for tipped workers this year, delaying a scheduled July increase to October.1 Further actions interfering with I-82 will deny this group of low-wage workers vital wage gains and economic security in one of the highest cost-of-living metro areas in the country.Read more
Destroying the Fed’s independence to make monetary policy decisions would be a disaster for working people
During the presidential campaign, many people noted that a prospective Trump administration could trigger sustained upward pressure on inflation and interest rates if it tried to violate the Federal Reserve’s independent decision-making. This certainly seems to be happening now, as President Trump has made escalating threats to fire Fed Chair Jerome Powell for the sin of not doing exactly what Trump wants with interest rates. Preventing the political capture of Fed decision-making is the only thing standing in the way of the Trump administration seizing control of monetary policy and fueling higher inflation and interest rates for typical working families.
Workers need real security and flexibility, not pro-employer portable benefits proposals
On July 7, 2025, Senators Bill Cassidy (R-LA) and Tim Scott (R-SC) introduced a legislative package aiming to provide certain portable benefits to workers classified as independent contractors. “Portable benefits” is an umbrella term for various benefit programs that follow workers from job to job, rather than being tied to a specific employer. The legislative package is framed as an effort to address the rise of nontraditional work arrangements and the gig economy, in which workers are typically not classified as employees and therefore lack access to certain guaranteed workplace rights or longstanding employment-based benefits like health care and retirement benefits. While misclassification of workers as independent contractors represents a significant problem, the legislative package fails to address this important issue in the gig economy. Instead, the bills would institutionalize a second-tier status for independent workers and entrench their exclusion from the full protections and benefits guaranteed to traditional employees.Read more
Trump’s Department of Labor is dismantling key workplace protections
Congress has failed workers for decades. Policymakers have not raised the minimum wage in nearly 20 years. They have not passed legislation to fix our nation’s broken labor law, leaving the National Labor Relations Act largely untouched for more than 60 years. Further, they have failed to pass legislation providing U.S. workers with paid sick leave, predictable work schedules, and workplace protections against extreme heat.
Given Congress’s inability to pass legislation protecting workers’ wages and health and safety, federal regulations are critical to ensuring that workers have meaningful protections. However, Trump and his Department of Labor (DOL) recently announced a massive deregulation effort, robbing U.S. workers of dozens upon dozens of rules that protect them from being forced to risk illness and injury on the job and ensure that they are paid for their labor.
Federal regulations are written by agencies to carry out the specifics of laws passed by Congress. Since laws can remain unchanged for decades, regulations make sure that laws are implemented and administered effectively. Since returning to office, Trump has unleashed a deregulatory agenda that requires agencies to identify 10 regulations to repeal in order to enact one new regulation. This framework perpetuates the misguided belief that regulations are burdensome for employers and harm economic growth. On the contrary, the long-term benefits of regulations consistently outweigh the costs—and research shows their impact on jobs is either neutral or modestly positive.
Disinvestment in the public sector undermines opportunities for Black women across the South: Trump cuts further threaten key services for working people across the nation
In many states across the South, the public sector is a key driver of economic growth and improvements in most Southerners’ quality of life. The public sector includes workers in federal, state, and local government that we all rely on to educate children across the region, care for sick and elderly family members, ensure food and water are safe to consume, provide public transportation and sanitation services, and ensure access to a wide range of other public services.
Unfortunately, many in the U.S. fail to recognize how central the public sector is to their daily quality of life. Further, these workers and the public sector generally are often maligned by lawmakers seeking to undermine public agencies and the workers that staff them. This facilitates disinvestment in the public sector. Over the last few decades, public-sector wages have failed to keep up with the cost of living, retirement benefits have been cut, and workloads have steadily increased as workers have left or been pushed out of these jobs. These declines in public-sector job quality across the South have led to higher turnover rates, understaffed agencies, and a decline in the quality of public services.
Private-sector job growth notably weaker in June amid rising economic uncertainty
Below, EPI senior economist Elise Gould offers her insights on the jobs report for June released this morning. Read the full thread here.
The radical Republican budget bill steals from the poor to give tax cuts to the rich
Yesterday, the Senate passed a budget bill that will create a weaker and more unequal U.S. economy. It is even more radical than the House version, with deeper Medicaid cuts that will destroy rural hospitals and strain state budgets, while adding nearly $4 trillion to the federal deficit. The House should reject this legislation and start from scratch. The stakes couldn’t be higher—the bill being rushed to passage will do grave damage to the economy and the well-being of U.S. families for years to come.
The bill is designed to cause a shocking upward redistribution of income. It includes draconian spending cuts—mostly to health care and food assistance for children and families—in order to give massive tax cuts to the wealthiest households. Because these cuts to health care and food assistance are so broad and deep, and because the tax cuts for anybody who is not already rich are so paltry, the bill will cause the bottom 40% of households to actually lose income on average. This group includes roughly 125 million people, and for a family of three it will include households with incomes up to $85,000. Meanwhile, households in the top 0.1% (those making over $3.3 million per year) will gain over $100,000 annually under this bill.
Republicans are trying to hide just how much their budget bill costs
The writer Dan Davies once noted that “Good ideas do not need lots of lies told about them in order to gain public acceptance.” It’s always a useful insight, and particularly relevant to how the Senate passed its version of the radical Republican budget bill earlier this week.
The legislation is mostly a stunning exercise in the upward redistribution of income, consisting of huge tax cuts mostly for the rich and steep spending cuts mostly for health care and nutrition assistance programs used by vulnerable families. But because the tax cuts boosting incomes for the rich are so large, even with the steep spending cuts, it is also an exercise in significantly increasing federal deficits and debt.
The Senate version of the bill would add nearly $4 trillion to the federal debt. This is a lot to be adding to the federal debt during a time when unemployment is low, inflation is above-target, and interest rates remain far higher than they’ve been for most of the last 15 years.
Further, if Republicans wanted to add $4 trillion to the national debt, they could write a check for $12,000 to every single adult and child in the United States. Yet, the bottom 40% of households in the U.S. won’t get any benefit at all from this bill, instead their incomes will outright fall. Why? Because all of that $4 trillion (and more) is needed to write enormous checks to the richest households. For example, the richest 130,000 households—who currently make more than $5 million per year—will receive almost $300,000 annually from the Republican budget bill.