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Trump’s Budget Could Cut 200,000 Federal Jobs

Mar 16, 2017

Civil servants might want to start sending out their resumes to the private sector.

President Donald Trump’s budget proposal, released early Thursday, could lead to between 100,000 and 200,000 cuts to federal civilian jobs, Mark Zandi, chief economist for Moody’s Analytics, told Fortune.

At its worst, that’s a 9% cut to civil servant jobs, not including the postal service, which is an independent agency and exempted from the general budget process.

According to the Bureau of Labor Statistics, there are about 2.2 million civilian jobs in the federal government, excluding the mailing agency, making up about 1.5% of all jobs in the United States.

Already, civil servant jobs are near historic lows. They accounted for 2% of U.S. jobs in the early 1990s and between 3% and 4% of U.S. jobs in the 1960s.

Now to be clear, budgets must be passed by both houses of Congress, and the specifics are bound to change through that process. Republican lawmakers including Senator Lindsey Graham have already raised issues with the cuts to the State Department and foreign aid, calling the budget “dead on arrival.”

Trump’s budget proposal released Thursday calls for a $54 billion increase in defense spending, paid for by cuts in other discretionary non-defense spending. Budgets for the Environmental Protection Agency, as well as the departments of State, Agriculture and Labor would each be slashed more than 20%.

The proposal also calls for the government to eliminate funding for 19 agencies including the National Endowment for the Arts and the Corporation for Public Broadcasting.

“Trump stuck to his script,” Zandi. “He said this is what he was going to do, and he’s doing it. Increase military, increase spending on veterans and cut everything else. It’s not at all surprising.”

Overall, Zandi estimates the president’s budget proposal will have very little impact on the U.S. economy, but certain regions of the country will be affected more dramatically.

Given the high concentration of federal jobs surrounding the capitol, he estimates employment in Washington D.C. area could fall by 1.8%, personal income by 3.5%, and lower home prices by 1.9%.

In contrast, areas of the country that could benefit are places with a high concentration of military jobs and veterans, like Virginia, Southern California, parts of Florida, and Texas.

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