Financial Times - (archived: https://archive.ph/NdTHo ) Effort to cut federal workforce takes aim at key US jobs engine

Government and healthcare have emerged as biggest source of American employment, particularly for knowledge workers

Taylor Nicole Rogers in New York 28 minutes ago

Elon Musk’s plan to slash the federal workforce under Donald Trump is poised to upend one of the strongest engines of the US labour market: the government.

Government and healthcare jobs have been the biggest source of employment in the past year, particularly for knowledge workers, data shows. US job recruiters, economists and labour leaders fear the plan to cut the workforce could crimp the number of good available jobs at a time of declining private-sector employment, compounding already-stiff competition for white-collar jobs.

“We’re getting closer to where we are not creating as many jobs as we need to keep up with the population,” said Cory Stahle, an economist at jobs site Indeed. With fewer federal openings, “we start entering a territory where [the labour market] starts to get a little bit sketchier”.

Excluding the Postal Service, the federal government created 2,100 jobs in October. Total payrolls grew by only 12,000 workers that month, according to the labour department, as private sector payrolls were damped by strikes and Hurricanes Helene and Milton. 

The federal government employs just 2 per cent of the US workforce but has been among the largest creators of white-collar jobs in recent years. The jobs of its 3mn civilian employees range from law enforcement officers at airports and prisons to medical providers to postal workers.

The popularity of government work has exploded as workers, particularly younger ones, seek out stability after headline-grabbing lay-offs in tech and on Wall Street. Handshake, a US jobs site targeting college students and recent graduates, reported applications to federal government jobs grew 55 per cent last year. Others are after robust healthcare and retirement benefits, said Andy Challenger of outplacement firm Challenger, Gray and Christmas. 

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