Jobs slowdown: an own goal by the Trump Administration

Moody's Analytics says 20 states could go into recession ("Massachusetts recession risk is high," Boston Globe). 

-- "US Job Openings Fell in July to Lowest Level in Nearly a Year," Bloomberg

Most jobs have a multiplier effect, usually from 2 to 4.  Not unlike how there are 4-10 soldiers in the back supporting each soldier in combat.

The Trump Administration has eliminated 300,000 jobs ("Year Will End With 300,000 Fewer Federal Workers, Trump Official Says," New York Times).  With a multiplier, that's likely about 1.5 million jobs lost.  As well as people who decide to leave because of the uncertainty ("These Philly federal workers loved their jobs. But amid Trump’s shakeup they chose to leave," Philadelphia Inquirer)

Cuts at the Agency for International Development and others in all told, have cost 176,000 jobs ("'We have to try lifting ourselves': USAID workers fired months ago are still scrambling for jobs," USA Today).

Separately, federal grant cuts also effect jobs and the health of organizations such as farms, universities ("Stanford lays off hundreds, citing federal cuts under Trump," San Francisco Chronicle, "How Trump forced cuts at wealthy universities," Inside Higher Education), and other entities.  Plus the multiplier effect on contractors and others.

Immigration enforcement has affected workers in many fields including agriculture, meat packing, and retail, manufacturing sites ("Homeland security official says 475 people were detained during an immigration raid in Georgia," AP) and restaurants.  That reduces jobs, not just for the undocumented, but for other workers.

Let alone all the uncertainty created by tariffs and other interventions into the economy, leading businesses to postpone plans for growth ("American Businesses in ‘Survival Mode’ as Trump Tariffs Pile Up," New York Times).  Many firms are doing layoffs.  Chevron and BP announced major cuts ("Chevron and BP cutting thousands of jobs," Chemistry World).  Tech firms too.

And we can't forget healthcare, which will be roiled by cuts to Medicaid, leading to hospital closures and job cuts, which are happening already ("How Medicaid and SNAP Cutbacks in the “One Big Beautiful Bill” Would Trigger Big and Bigger Job Losses Across States," Commonwealth Fund, "Hospitals make painful choices as federal cutbacks add to economic headwinds," AAMC, "Health care has been a job market bright spot, but Trump's budget bill looms over the industry," NBC).

President Donald Trump holds up a chart while speaking during trade announcement event at the White House on April 2, 2025. Chip Somodevilla/Getty Images

I read a story, don't remember from where, a conservative organ, saying "what do you mean losses from tariffs? I don't see any."  It reminded me of Brexit.  Effects aren't immediate.  They happen over long periods of time, and persist.  

But they are starting to be felt (" Government & Politics States begin to see job losses from Trump’s cuts, housing and spending slowdowns," Indiana Capital Chronicle).

Plus, in terms of "bolstering US manufacturing," a company can't build a plant in 4-6 months, the period in which Trump has been imposing illegal tariffs ("Trump’s Sweeping Tariffs Invalidated by Appeals Court," New York Times).  From the CNN article, "If Trump loses his tariff lawsuit, America may have to refund businesses more than $200 billion":

American businesses have paid over $210 billion as of August 24 to cover the tariffs that US courts have determined are illegal. On Tuesday, Trump acknowledged that the court’s decision, if upheld by the Supreme Court, could result in the US Treasury having to “give back” tariff revenue collected.

It takes years to build a plant ("Trump is promising a US manufacturing renaissance. Many experts are dubious," Guardian).

Der Spiegel magazine cover, 6/2/2017.

With the previous report of lackluster job numbers, Trump fired the director of the Bureau of Labor Statistics ("Trump fires lead official on economic data as tariffs cause market drop," BBC), with likely broader negative repercussions in terms of trust in the US as a partner and a market ("Firing of labor statistics head undermines trust in key data, ex-Trump official warns," PBS).

Who is Trump gonna fire now? ("First Jobs Report Since Labor Statistics Chief’s Firing Shows Weak Market, as Trump Pledges ‘Real Numbers’ Still to Come," Time).

I'm surprised that anyone is surprised by this economic downturn.

Another view on the sale of federal buildings: need for updated facilities | Impact comparable to the closure of city-based navy shipyards?

I have been quick to criticize the Trump Administration for its agenda on shrinking its real estate portfolio.  While some of it, like abrogating leases, was a part of Trump/Musk DOGE agenda of destruction of the federal government without any connection to need for a functioning government--e.g. leases for Social Security offices and federal land management offices were broken--there is another issue.

The buildings, many built before 1980 are old, often poorly maintained and expensive to renovate.  Then it may make sense to sell and rebuild, or since the government is shrinking, lease smaller buildings.

The JFK Federal Building in Boston. Photo: Paul Marotta/Getty Images

From the Boston Globe article, "The federal government could soon sell these three big downtown Boston buildings The JFK, O’Neill, and McCormack federal buildings span 2.6 million square feet, combined. A federal board is considering putting them up for sale":

... much of the federal government’s 180 million-square-foot property portfolio needs extensive repair, and is riddled with expensive problems such as antiquated air systems, leaking roofs, unusable elevators, and flooding basements, the board said. Buildings managed by the GSA are on average more than 50 years old.

“Congress cannot appropriate its way out of this maintenance backlog,” said Nick Rahall, a former congressman from West Virginia and PBRB board member. “The inventory needs to be shrunk so tax dollars can be invested in properties where employees are actually coming to work.”

Like a broken clock being right twice a day, the Trump Administration has, amongst its chaotic and authoritarian decision making, made a couple of good decisions.  This may be one at least partially,.

-- "Trump Policies Shake the Foundations of the US Office Market," Natixis

-- "Trump May Sell Up to 67% of Government's Office Portfolio," CRE Daily

However, proponents of the sale of federal property argue that there is a lot of profit to be made ("Chance favors the prepared mind: residential conversion of federal buildings in Downtown DC needs "A Vision Plan for Judicious Conversion of Federal Properties in the District of Columbia."" [2025]) and that's a problem.  

The buildings are old, the commercial property market is soft, especially in Boston ("One of Boston’s skyline-defining towers is on the auction block — and expected to sell at a big discount," Boston Globe) and DC (The Increasing Levels of Vacant Office Space: The Achilles’ Heel of DC's Office Market), made only worse by federal government shrinkage and federal real estate being a significant element of the local market ("Trump wants to move 100K federal jobs out of D.C. What could that look like?," Virginia Public Media), and the buildings may not lend themselves to refurbishment, making the property valuable only in that it can be redeveloped after the expense of demolition of current facilities.

And, still, these decisions will be negative for most major downtowns where a sell off will occur ("The 443 federal buildings Trump administration could sell," Boston Globe).

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Impact as significant as closure of federal Navy Yards.  In the 1960s and later, the Department of Defense closed naval facility shipyard functions in cities like Brooklyn, DC, Boston, Charleston, South Carolina, and Philadelphia.  

Thousands of workers at the sites lost their jobs ("Military cutback will eliminate 37,000 jobs," AP, about a later round of closures), some functions were dispersed, often to suburbs, and with the multiplier effect even more jobs were lost (about the closure of the Navy Yard in Long Beach, "In Long Beach, an Era Ends in Tears," Los Angeles Times).

Blog commenter Will makes the point that this had significant impact on what was called 1960s "urban decline."  A lot of the jobs were industrial.  The closure shifted cities to a post-industrial economy but with fewer jobs overall, and fewer blue collar jobs especially.  (This is one of the arguments made by William Junious Wilson in When Work Disappears.

For example, at its peak in WW2, the Washington Navy Yard had 20,000 employees working on ships and munitions manufacturing, the Philadelphia Navy Yard, 40,000 employees (that facility didn't close until the 1990s), 42,000 at the Brooklyn Navy Yard.

At the time, too, these facilities were developers of innovative technology, although the concept of spinoff commercial technology transfer wasn't an issue then.

The shrinkage of the federal government under the Trump Administration will likely have similar effects.

Continued misrepresentations in press coverage about Wal-mart and DC

Walmart originally announced plans for 5 stores in DC , then added a 6th store in consultation with the DC Government.  Half of the stores--all the stores under construction currently--are to be placed in what we would call "higher income areas" of DC; two of the other stores are in Ward 7.

The first Ward 7 store is to be close to the DC-Maryland border on East Capitol Street; the other store would be at Skyland, a proposed redevelopment of a shopping center on Good Hope Road SE, right on the border of the wards, so that Ward 8 is immediately across the street--personally I think the desire to build this shopping center, while honorable, is a stretch, and will put other existing shopping centers at Congress Heights and the Good Hope Marketplace, at risk, because there isn't enough economic demand to support all three locations.

The site where the "Wal-mart" shopping center on New York Avenue was to be located has already been cleared, and it likely will be many years before anything ever gets built there, leaving a big hole in the streetscape.

The other location was to be at New York and Montana Avenues NE, on the commuting out of the city side of the road.  But two weeks ago it was announced that this project wouldn't be going forward.  While that area is industrial and gnarly looking, it's arguable that it's severely economically distressed.

So only 40%, or two, of the Wal-mart locations in DC are to serve distressed areas, and it is questionable that the Skyland location will ever open.  And for that matter, we don't know when the East Capitol Street NE store will get underway.

Therefore, the statement in this column, "In DC, Wal-Mart job seekers want work. Any work.," by Post writer Petula Dvorak severely mis-states the reality of Wal-mart's entry into the city:

In the District, Wal-Mart isn’t killing off mom-and-pop stores and sweet little groceries. It is going into places that have nothing and have had nothing for decades. And it is providing an anchor for other redevelopment to follow.

The Wal-mart on Georgia Avenue is up the street from two Safeways.  The Wal-mart on H St. NW is close to a Harris-Teeter, a Giant, and two Safeways.  The store that will be on Riggs Road NE is about one-half mile from a Giant Supermarket, albeit just over the border in Maryland (and in fact until the 1990s the store was once located where the Fort Totten mixed use development is being constructed).

Plus, Wal-mart's business model doesn't support their being termed an "anchor," because retail anchors support other retailers.  Wal-mart's business model is to capture as much as 100% of the spending of customers--that doesn't leave any room for spending at nearby businesses.

While the stores likely will be a source of jobs for low-income residents, it will be a hike for most low income residents to get to the store, and serving low income residents, based on the majority of the locations for the stores, shouldn't be touted as a reason to welcome the company into DC.

Interesting concept: retailers paying their employees well

Time Magazine has an article, "Future of Retail: Companies That Profit By Investing in Employees," based on the work of MIT professor Zeynep Ton.  From the article:

But what if the logic behind viewing retail labor as an expense to be cut, rather than as an asset to be invested in, is unsound? Zeynep Ton, a Professor of Operations Management at MIT’s Sloan School of Management, argues just that. Her research has shown that by underinvesting in their employees, retailers are actually making their operations much more inefficient, and therefore much less profitable.

This is an area that Ton has been studying for ten years, and what she has consistently found is that companies that buck the status quo and invest heavily in their workforce actually are able to not only compete with their competitors on service but on price too. In a paper she published in the Harvard Business Review earlier this year, she writes:

“Highly successful retail chains — such as QuickTrip convenience stores, Mercadona and Trader Joe’s supermarkets, and Costco wholesale clubs — not only invest heavily in store employees, but also have the lowest prices in their industries, solid financial performance, and better customer service than their competitors.”

Increased Expenses, But Lower Prices?
When Ton first started talking about the results of her research to retail industry executives, they were skeptical. “What I kept hearing from industry people was that investing in employees makes a lot of sense if you differentiate based on the products you offer or service, but it wouldn’t work for low-cost retailers,” she says. “That’s why I specifically studied low-cost retailers. If you can do it in low-cost you can do it anywhere.”


The reality is that it's not just about investing in employees--a full-time Trader Joe's employee makes $40,000 to $60,000 annually, whereas most retail workers make half that or less and a significant proportion of retail workers receive some public assistance--it's also about the business model.  For example, each of the companies studied also has a narrower range of products, a higher number of private-label products, which results in simpler logistics and higher profit margins.

From the article:

When workers are well trained and a retail operation is fully staffed, operational failures like missing merchandise are severely mitigated. And when employees are paid and trained well, they are much less likely to leave. Indeed, turnover at all the stores Ton studies in her report are much lower than the industry average, which reduces the need to invest in training new employees.

So the article is interesting especially in terms of some cities (such as DC) and their embrace of big box retailers such as Walmart or other chain operations, such as McDonalds.  At one level, these establishments do hire people ("jobs"), and there is something to said for entry-level jobs and learning "how to work"--to be on time, to perform your duties, etc.--the issue is the capacity to "move on up" within those companies or the field generally.

Gentrification, neighborhood change, and wacked discourse

This week the big news is that DC's demographics are changing and that African-Americans remain a bare majority of the population. See "D.C.'s black majority status slips away" from the Post. The article has graphics, although I think the graphics printed in the hard copy edition are superior to the online package.

Today's Post has a pretty limited follow-up article, "On Barry's old block, a racial shift," considering this issue in terms of the context of a block where Marion Barry, the former Mayor, lived when he first became Mayor. Because history and DC existed before 1975, when Marion Barry moved to the 1200 block of E Street NE, I don't think the article offers us much in the way of a long term, historically infused perspective.

Also see these blog entries I wrote the week before:

- Is commercial district revitalization racist?
- Is smart growth racist?

and years earlier:

- Commerz in the 'hood... (aka Commerce is the Engine of Urbanism) (2006)
- More about contested spaces and gentrification (2005)

- Contested spaces (2007)

and this paper by GWU sociology professors Gregory D. Squires and Charis E. Kubrin. "Privileged Places: Race, Uneven Development, and the Geography of Opportunity in Urban America," Urban Studies 42, (1): 47-68. 2005

Plus, last week the City Paper had what I thought of as a not very interesting article, "Confessions of a Black D.C. Gentrifier."

I just didn't think it offered much of anything new. I'd summarize the interesting points in fewer than 30 words--that African-Americans are moving into city neighborhoods, but because they are black, they aren't seen as interlopers and may in fact feel invisible.

While I know the writer is a journalist, not a planner, I didn't think the piece offered much insight from the perspective of planning or the voluminous writings on the "gentrification" process (isn't that something a journalist ought to look into when writing a story on gentrification?), especially the theoretical problems with the literature, because it's based on a presumption that neighborhoods and cities are only supposed to decline and that people with income and choice are not supposed to want to live in/move back to cities.

The real color of urban living is green: it's about money first and foremost; and attitude--a favorable belief, willingness, and interest in living in the city when most of the nation lives in the suburbs.

This is complemented by educational attainment and age. Generally, people who are younger and have more income and education are more willing to live in the city than people who don't share these demographic characteristics.

So as the city continues to improve, albeit fitfully, and with many many bumps along the way, most people seem to be asking the wrong question.

Here's a better question.

Q: Why is Prince George's County majority black? Why is Charles County majority black?

A: Because African-Americans continue to move out of DC--primarily to Prince George's County, making it a majority African-American community, and in subsequent waves of migration from PG County, Charles County has also become majority black over the past decade.

The most interesting and important question is why are middle class and upper middle class blacks fleeing the City of Washington?

People want bigger houses and more land, things they don't feel they can get in the city. Plus, people see the city as something to escape, the place where their parents and grandparents--the old people--lived, not as something exciting.

Yes, the knock on "Ward 9," Prince George's County, is that it is many of the residents there are people who made their nut working for DC Government, such as Leslie Johnson, wife of the former County Executive, who served as an administrative law judge for the DC Government for decades, long enough to retire from the position with a full pension.

The other question that isn't being asked is where would the city be if Asians, Hispanics, and Whites weren't moving into the city, while outmigration of middle class African-Americans continues unabated?

The answer to that question is that the city would be facing further revenue shortfalls and a population marked by an increasing percentage of the region's poorest residents.*

The issue isn't that scads of whiteys (and Hispanics) are moving into the city as much as it is that they are moving in as the outmigration of middle class African-Americans continues and accelerates.

As long as the so called lament about "gentrification" isn't direct about this fact, the discussion for the most part is empty.

Tom Toles editorial cartoon from the Buffalo News, 1998.

Now I live in Ward 4, which historically has been the most African American and middle class in the city.

We moved to the Manor Park neighborhood in June 2008. In the 11 houses within a couple blocks that I know of that changed hands over the period from just before we moved in until today, one household is mixed white and black, all the others are white or white-hispanic. None are solely African-American. Most of the households, but not all, were African-American previously. There was no blockbusting or anything going on.

Mostly, it's a matter of older households turning over and new people interested in the area showing up and making an offer.

Getting back to my point about the city and the general loss of population, according to the latest statistics, Ward 4 has gone up 772 people in population since 2000. The population of African Americans dropped by about 9,000 residents, and was countered by an increase of about 4,000 whites and 6,000 Hispanics.

The issue is why aren't middle class African-Americans interested in moving into this neighborhood?, which is within easy biking and walking distance from the Takoma Metro, and while not replete with amenities, has decent housing stock and neighborhood amenities BUT ALSO HAS CRAPPY SCHOOLS.

On the other hand, is what's offered in Prince George's County really all that much better?

BUT IT IS (FOR THE MOST PART) NEW.

Most people in our neighborhood take the schools issue for granted, figuring that they can find a charter school or get an out-of-boundary placement in a quality DCPS school for their children, and being resigned to having to deal with the transportation requirements that not having quality walkable neighborhood schools imposes on them (we live within 5 blocks of Whittier Elementary and Coolidge High School).

But that isn't a good thing. It's why people are so hyped about the Michelle Rhee issue. I happened to be in favor of improving schools, but I believed and continue to believe that Michelle Rhee had no real system for school improvement other than hiring younger teachers and firing older teachers. And she was as arbitrary and capricious in her decision making, especially personnel decisions, as the worst of the various Barry Administrations. How I could I ever be supportive of someone like that?

Of course, the influx of new population in Wards 2 and 6 in new multiunit housing constructed in new buildings is mostly coming without displacement--mostly the buildings have been constructed where there wasn't housing previously extant, although this isn't entirely true, especially around the new baseball stadium and on the outskirts of downtown.

In Ward 1 some of the "new housing" that has been developed came at the expense of affordable housing, such as on Clifton Street. But even there most of the new housing on 14th Street NW has not come at the expense of existing residents--except in how it leads to an upgrading of housing and an increased demand for extant housing, especially buildings that are eligible for historic designation, and this can produce some displacement pressure.

But for the most part, the new residents added to the city in Wards 1, 2, and 6 are in new buildings that didn't displace previous residents. Is this "gentrification"? I guess it is, but it comes mostly without displacement, which is not part of classical definition. What we have here is a reproduction of space in the city, abetted by continued black outmigration.

In the meantime, Wards 7 and 8 are still pretty black, Ward 3 is pretty white, and Ward 5 is experiencing White and Hispanic influx.

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* The other question is why do people have so much difficulty moving up and out of being lower income. This has to do with educational attainment, readiness for employment, and other factors. And it's paired up with the fact that as the U.S. economy hollows out, more jobs require more and more education and training, especially of a technical nature, even for what are considered to be blue collar jobs...