InsideSources

The labor market was able to bounce back from its lackluster growth the previous month by adding 211,000 new jobs in April, according to a federal report Friday.

President Donald Trump entered office at a time of relatively strong job growth. The labor market later slowed to a crawl by adding only 98,000 new jobs in March. The Bureau of Labor Statistics found in its latest jobs report that the labor market growth bounced back by adding 211,000 new jobs.

“Total nonfarm payroll employment increased by 211,000 in April, and the unemployment rate was little changed at 4.4 percent,” the jobs reported states. “Job gains occurred in leisure and hospitality, health care and social assistance, financial activities, and mining.”

The economy has been in a good position when in comes to the unemployment rate. It has even remained close to full employment. The economy still faces some lingering issues from the recession despite trending in a positive direction overall.

“The unemployment rate is pretty low,” Orley Ashenfelter, a professor of economics at Princeton University, told InsideSources. “The labor market is very good from that point of view. The problem with it is, the pay is so horrible.”

The jobs report found average wages increased by seven cents to $26.19 in the month of April. Ashenfelter warns wage growth has been concerning for decades. The Pew Research Center found in a 2014 report that wage growth for most workers has flat-lined since 1964 when adjusted for inflation.

“It’s been dismal for many decades,” explained Ashenfelter. “I would say people mischaracterized the labor market. Getting jobs is not the problem, there are tons of jobs. The problem is they don’t pay very well.”

The labor force participation rate and underemployment have also been a point of concern. The participation rate tracks the number of employed and those actively seeking work as a percentage of the total population. Workers experiencing underemployment are stuck in part-time positions or can’t find roles that match their skills.

The participation rate has declined rapidly in the decade since the last recession. The concern by some is that too many working age adults are among those who have dropped out. Trinity College Prof. Josh Stillwagon contests the participation rate shouldn’t be as big a concern since most of the decline is due to retirees and student adults.

“There is too much focus on labor force participation,” Stillwagon, who teaches economics, said. “These numbers are skewed by the fact that you have baby boomers retiring now and more young adults attending college. It is better to look at the employment-to-population ratio for prime age workers.”

The employment-to-population ratio for prime age adults has shown steady growth since the recession. The ratio dropped from 81 percent of the population to 74 percent when the recession hit. It is approaching where it was before the recession.

“I do worry about underemployment though,” Stillwagon said. “There have been a large number of part-time workers, which was a serious concern, but that is less so the case now. There is also a worry of underemployment in the sense of workers entering jobs below their qualifications.”

The Gross Domestic Product (GDP) has also seen disappointing growth recently. GDP tracks the total dollar value of all goods and services produced over a specific time period. The Bureau of Economic Analysis (BEA) found in its advance estimates April 28 that it only increased by 0.7 percent annual rate in the first quarter of 2017.

Trump likely won the presidency in large part to his renewed focus on the working class. His stance on some critical labor issues even helped him to secure many traditionally blue districts. Gallup found economic confidence has increased significantly since election night.

The leisure and hospitality sector saw the most significant increase of new jobs at 55,000. It was followed by health care and social assistance, professional and business services, financial activities, and mining. The jobs report does not include farm workers, private household employees or nonprofits.

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Republican President Donald Trump and labor unions have had an interesting relationship–one that has become even more complicated since he took office.

Trump was able to secure a surprising number of working class districts with his focus on labor issues. His stance has set him apart from many others on the right. But his relationship with unions tends to be complex, as labor and the president balance their political views, what union members think, and the president’s background as a businessman.

Trump continues to face strong opposition from union leaders despite support from union members. Republicans and the labor movement have had a contentious relationship for decades, with labor long being closely aligned with Democrats.

“Labor doesn’t love him. In some ways they hate him because he’s beating them,” Prof. Richard Vedder, who teaches economics at Ohio University, told InsideSources. “But on the other hand, deep down, I think he’s one of their kind of guys at the same time. It’s sort of a contradiction.”

Trump has made the working class a central focus of his presidency. He promised to help workers by bringing back manufacturing and other traditional jobs. His rhetoric resonated with many private-sector workers, including in districts that have strong liberal and union influences.

“Many of the working class union members voted for Trump over the opposition from union leaders,” Michigan State University Prof. John Beck told InsideSources. “The union leaders are going to have to walk a fine line when it comes to not wanting to be so on the other side of their members.”

Labor unions helped organize national protests and grassroots campaigns against Trump. The National Institute for Labor Relations Research (NILRR) found in a recent report that labor unions spent $1.7 billion during the last election. Their efforts weren’t enough, however, when election day finally came this past November.

“They endorsed the Democratic candidate and the members went their own way, and in many cases ignored the leadership and voted for Trump,” Maria Hylton, an employment law professor at Boston University, told InsideSources. “That has to be something that the leadership in the unions are paying attention to.”

Indiana University Southeast Prof. Eric Schansberg adds there’s a clear distinction between union leaders and members that can account for the different viewpoints.  He notes union leadership portrays the united front while membership has more diverse opinions that are more personal to their situation.

“They have to be careful,” Schansberg, who teaches economics, said. “The more popular he is, the harder it is for the leadership to take a stand away from that because they stick out like a sore thumb. To the extent that he’s unpopular, then if they don’t like him, it becomes easier for them to talk about that.”

Union membership veering from leadership likely played an important role on Election Day. The working class generally helped push Trump to victory. He was able to connect to those voters on a personal level during the course of the campaign.

“There’s no question that there was frustration within different parts of the labor movement at the base,” said Beck, who teaches labor policy with a particular focus on collective bargaining and unions.

Beck adds workers have experienced flat wage growth and decreased opportunities over the years. Workers are increasingly seeing their skills becoming obsolete in the face of emerging technologies. The president argued when launching his campaign that the government has failed both workers and employers.

Trump is not typical in that he takes elements from both sides of the aisle to promote his worker-focused agenda. He sides with many others on the right on issues like regulations and taxes, but has taken a more progressive tone on issues like trade and entitlements.

“Trump is not a typical Republican based on past standards,” Vedder said. “Most Republican presidents and candidates for president have taken stances that are almost diametrically opposed to those of labor unions.”

Trump has been willing to break with his own party on a range of issues. He also has some viewpoints that overlap with those of the labor movement. His view that trade should prioritize domestic workers echoed concerns expressed by unions leaders for decades. He has also gained support for his stance on manufacturing and energy.

“By and large he has not taken on a strong anti-labor agenda or one that would be viewed as anti-labor by the labor unions,” Vedder said. “Similarly you see that at the Department of Labor.”

Trump received some union praise over his decision to withdraw from the Trans-Pacific Partnership (TPP). The trade deal had drawn fierce criticism during the campaign. Labor unions have contested it’s designed to enrich corporations and other special interests at the expense of workers.

“I think the unions are probably, especially the ones in the manufacturing sector and coal, are probably excited at the prospect of someone coming in and reversing this decades-long decline in jobs,” Hylton said. “On the other hand, I suspect that they’re a little doubtful of his ability to get some of these things done.”

Hylton adds the administration actually hasn’t done much with labor thus far. Republicans and the administration have been more focused on healthcare and taxes in recent months. Regent University Prof. Bruce Cameron counters the administration and unions aren’t as alike as some believe.

“There may be some small practical areas where they might agree with Donald Trump,” Cameron, who teaches law with a particular focus on labor, told InsideSources. “But they fundamentally disagree. They’re collectivist, they support liberal points of view on everything. It would seem to me there’s no common ground.”

He adds a lot of those policy agreements they have discussed have been vague and abstract. The issue is whether the administration can actually implement reforms that unions support. They might both agree trade should prioritize domestic workers, but that doesn’t mean they will agree on how to best do that.

“I don’t see anything in his policies that could be labeled liberal,” Prof. Richard Hurd, who teaches and writes on labor relations at Cornell University, told InsideSources. “His rhetoric indicates that he’s very interested in helping working-class people, but none of his policy proposals are viewed by the labor movement as friendly to workers.”

Labor unions seemed to oppose Trump on a personal level at times. They were among those groups that accused the president of inciting hate during the election. AFL-CIO President Richard Trumka even called him the most racist presidential candidate ever. Other unions expressed similar viewpoints.

“There’s probably two kinds of resentments towards Trump,” Ohio University Prof. Richard Vedder said. “There’s probably some people who think of him as a rich man who thinks he knows it all. I suspect there is some of that. And I think there is a lot of frustration in the labor movement because they spent a lot of money trying to get Hillary Clinton elected.”

Vedder adds unions have been facing long-term challenges that might be fueling their resentment. Unions have been slowly losing members and influence in recent decades. The Bureau of Labor Statistics found union membership fell from 20.1 percent in 1983 to just 11.1 percent by 2014.

Trump and the labor movement have a relationship that predates his entrance into politics. His hotel and real estate business had him dealing with a range of construction and service unions. Hurd notes that experience might very well shape how he deals with unions throughout his presidency.

“He does have a history of working with unions and cutting deals with them when negotiating arrangements with both the hotel employee unions and construction unions,” Hurd said. “If he ends up tilting towards his experience in that regard, and is willing to negotiate in ways that are beneficial to workers, and that he feels like he’s benefiting, we could end of seeing a reasonably productive relationship, at times, with the labor movement.”

Trump International Hotel Las Vegas became embroiled in a labor dispute just prior to the election. The Culinary Workers Union Local 226 and the Bartenders Union Local 165 had tried to unionize the hotel. The dispute lasted for over a year but finally ended in an agreement just a month before Inauguration Day. Trump was campaigning through most of the dispute.

“His background as a developer means he is very familiar with private labor unions,” Center of the American Experiment Vice President Kim Crockett told InsideSources. “Plus he has signaled that he wants to speak for and look out for the ‘little guy,’ which in some cases means people who are in the trades.”

Trump has garnered some union support despite the general opposition from labor leaders. The National Border Patrol Council (NBPC) made its first-ever presidential endorsement last year in favor of him. He has also received praise from construction and energy sector unions for his support of pipeline and infrastructure projects.

“Now that subset of the construction unions that like him, or at least indicated a willingness to work with him, are in line with his views on energy,” Hurd said. “It’s a portion of the labor movement that has feuded with the environmentalist movement.”

The Laborers’ International Union of North America (LIUNA) and other unions praised a decision by the administration to relaunch construction of the Keystone XL and Dakota Access pipelines. The president called the pipeline the first of many infrastructure projects during his announcement. The $8 billion project is expected to create thousands of jobs.

“You have a number of construction unions, which he is playing very strong with,” Michigan State University Prof. John Beck said. “The problem that you have is this is probably the same administration that is going to turnaround and try to get rid of Davis-Bacon and federal prevailing wage legislation.”

The Davis-Bacon Act of 1931 established prevailing wage requirements for public works projects. The prevailing wage dictates what the majority of workers must be paid while working on government contracts in particular regions. It makes it more difficult to compete with construction unions through reduced costs.

“He invited a group of union leaders to meet with him early on,” Hurd said. “It involved a bunch of construction unions. Not all the construction unions, but a core of them, including the head of the North America’s Building Trades Unions.”

Indiana University Southeast Prof. Eric Schansberg notes it’s also important to make a distinction between private-sector and government unions. Trump did well among private-sector workers, but not so much among government workers. The labor movement, however, nearly evenly split between public- and private-sector union members, with a much higher rate of union membership in the public sector.

“When people talk about unions, they’re really talking about, in my experience, they’re really talking about a certain, fairly small segment of union membership,” said Schansberg.

The Bureau of Labor Statistics (BLS) reported that the union membership rate stands at 34.4 percent for public-sector workers, but only 6.4 percent for private. Schansberg adds even that small segment throws around a lot of weight in the trade and immigration debates.

“With private labor unions, you have profits to bargain over,” Crockett said. “With government unions, there are no profits to bargain over, just more tax dollars and political power to commandeer. The union money in the political cycle warped our political discourse, our representative democracy, and disenfranchised voters.”

Trump is going to determine much of his labor agenda by who he appoints to oversee the national workforce. Alexander Acosta was confirmed last week to lead the Department of Labor (DOL). CKE Restaurants President Andy Puzder was originally nominated for the position by eventually dropped out.

“His first announced nominee for the secretary of labor was widely opposed to the labor movement,” Hurd said. “When he eventually withdrew, the second nomination was less of a lightning rod and less problematic, although I understand unions weren’t terribly happy with his testimony when he was being vetted for approval.”

The National Labor Relations Board is another place the president will soon have to appoint new members. Bloomberg BNA reported recently that he is currently considering labor lawyers Marvin Kaplan and William Emanuel. The board helps resolve labor dispute cases. Former President Barack Obama instituted much of his economic agenda through department regulations and board decisions.

Trump and unions could see their relationship evolve even further over the next four years. They could become even further opposed or find more common ground. Schansberg, however, doesn’t see anything at the moment that indicates their dynamic will change anytime soon.

“I think in terms of leadership, it’s going to be about the same in four years,” Schansberg said. “The voters will be in about the same spot, and I think the leadership will not like Trump because he’s not going to do enough things to move the needle for them.”

Schansberg adds the working class may likely judge the president based on whether they believe he is actually trying to help, and not necessarily based on his accomplishments. Beck notes his success and ability to garner working class support might determine how friendly unions are in the future.

“The leadership is going to be willing to be part of anytime there’s a photo opportunity that may very well lead to jobs or at least the possibility that organized labor can be at the table,” Beck said. “You can be sure that they’re going to be in those discussions. That does not mean they trust him, nor are they going to back him.”

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Labor unions have long marked the first of May as a time to celebrate and fight for worker rights. The labor movement used the occasion this year to fight instead for illegal immigrants.

President Donald Trump promised throughout the campaign to fight illegal immigration. Those opposed to Trump have been highly critical of the president for wanting to clampdown on those here illegally. Several leading national unions joined forces with immigration reform advocates during a nationwide protest to commemorate May Day.

The CASA in Action partnered with the unions and other advocates who helped organize the protests in Washington D.C. The AFL-CIO, Service Employees International Union (SEIU), and others were among those that helped. Several protests were planned across the city, and all eventually converged on the White House.

“We want equal rights,” a Washington D.C. protester who identified himself as Eli M. told InsideSources. “That’s why I’m here because we want justice. I think everyone deserves an opportunity, not just some people, but everyone. We’re all humans and I think this is a fight for equal rights and that’s why I’m here today.”

Trump has proposed a number of immigration reforms that have angered critics on the left. He has focused on stopping illegal immigration, protecting domestic workers from foreign competition, and protecting against terrorists. Some believe the issue started way before the president took office.

“We’re here to support the immigrants in the country,” Carlos Artola, a protester in Washington D.C., told InsideSources. “It seems to go up and down with every administration. Every time we’re here to support them so they can get a better quality of life.”

Artola adds the current administration might be worse depending on how someone views it. His big concern is instead the policies and viewpoints that target immigrants. Washington D.C. protester Manuel Caceres agrees that the issue isn’t new, but counters that the president has undoubtedly made everything much worse.

“This is nothing new,” Caceres told InsideSources. “It doesn’t matter what person is in the White House. The only difference with the president right now manifested more, not against, but signed executive orders that really affects families. Families that are here for years working and making this country.”

President Trump promised throughout the campaign that he would build a wall along the Mexican border. He also signed two executive orders which were designed to temporarily prohibits travel from several Muslim-majority countries. Critics were quick to denounce both moves.

May Day has been used by the labor movement as a protest day since the late nineteenth century. The tradition started as a way to commemorate workers who were injured or killed during the Haymarket Square riot in Chicago in May 1886. The day has been used to celebrate workers and various other causes ever since.

“I understand that this is International Workers’ Day,” Jared Lane, a protester, told InsideSources. “We’re mostly focused on the Muslim ban, and the wall, and any immigration deportation in general.”

Caceres believes it is possible to find a middle ground that would address concerns on both sides. He would be open to compromises so long as immigrants that aren’t causing problems are treated fairly and left alone. He adds those immigrants who do bad things should be punished.

“I want to see a middle ground, something that is fair for everybody,” Caceres said. “We don’t count people who come in and do wrong things because everyone deserves what they deserve. People that come in and do the wrong thing, yes, they deserve justice. The law applies to everyone, doesn’t matter where they come from.”

Artola agrees that it is possible for both sides to find a common ground. The new immigration system could focus on national security instead of immigrants who are here just to work. Lane counters that there is no middle ground. He instead believes the goal should be open borders.

“I don’t see a middle ground,” Lane said. “The European Union has open borders between their countries, and yeah they have seen an influx of refugees, and also terror attacks, but I don’t think the correlation has one to do with the other, with the amount of immigrants pouring in and the attacks on those countries.”

An ideal system that addresses all the major concerns people have could prove unlikely. Caceres states any solution is likely to have problems, but it can still be designed to be effective. He adds the new system just needs to ensure it works for everyone and is fair.

“The ideal system is really hard to tell you because it never exists–a really perfect system,” Caceres said. “It’s something that should work for everyone.”

Eli dealt with the immigration system in a very personal way in recent years. He notes that his father was deported just two years ago. His father had been living in the U.S. for close to three decades and has since been unable to return from Mexico.

“My father was deported two years ago so that’s a biggie for me,” Eli said. “My kids ask for my father, and I can’t find words to tell them exactly what happened because I don’t want them to fear whatever is going on now.”

Eli also believes the current system is racist. He argues it disproportionately impacts people of color more than those who are white. The current system doesn’t make determinations based on race but does include special exemptions for close allies that make it easier for their citizens to immigrate or find temporary work here.

“The system should be equal,” Eli said. “The system shouldn’t target people just because they’re a different color. I think that’s the greatest thing because racism now is very bad.”

Protesters converged on airports and cities Jan. 27 when the original temporary travel ban was signed. Trump has faced a slew of protests since winning the presidency. Activists have gathered to oppose his rhetoric on women, his stance on environmental issues, his stance on immigration, and many other issues.

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With President Donald Trump reaching his first one hundred days in office Saturday, the business community remains optimistic he will deliver on key promises.

Trump has focused his presidency on helping the working class. His agenda looks to reduce taxes and regulations so that businesses can create more jobs and grow the economy. The business community firmly supports his agenda, but with some major promises still pending, they also urge results.

Business owners are primarily focused on regulations, taxation, and healthcare. The president has been able to rollback some regulations, but healthcare and tax reform remain unresolved. The National Federation of Independent Business (NFIB) found optimism among small business owners has surged since Trump took office.

“Our members are very pleased with the first one hundred days,” NFIB Communications Director Jack Mozloom told InsideSources. “The president has undertaken a number of initiatives that have been extremely important for small businesses for a number of years.”

Former President Barack Obama entered office during a severe economic downturn now known as the Great Recession. He finally started seeing steady economic gains towards the end of his presidency. The economy still faces many lingering issues that the new administration hopes to resolve.

The Job Creators Network (JCN) released a recent survey which found 60 percent of small business owners believe the president’s agenda will have a positive impact on their employees and customers. Tax reform was of particular interested to the business owners surveyed.

“The president did as much as he could on the healthcare side, and I think it’s really up to Congress to do the heavy lifting and making sure we get this right,” JCN President Alfredo Ortiz told InsideSources. “And then, of course, from a regulatory standpoint, I think there’s been a lot of action there.”

Business owners also want to see that the administration is putting forth a genuine effort. Implementing major initiatives like tax and healthcare reform can be difficult because of how complex and politically divisive they are. Lawmakers are likely to face setbacks so it’s critical the business community sees they’re actually trying.

“They want to see that there’s a genuine movement towards improvement,” Ortiz said. “I think we have seen that already.”

Republicans are looking to overhaul the tax code so that it promotes economic growth. The administration unveiled its tax reform plan Wednesday during a press conference. The president hopes to simplify the tax code while also lowering rates in order to reduce the tax burdens businesses currently face.

“As we near the hundred day mark, we’re encouraged by the president’s announcement outlining plans for tax reform,” Christin Fernandez, vice president of communications at the Retail Industry Leaders Association (RILA), told InsideSources. “For months we’ve been meeting with the administration and members of the House and Senate to showcase why comprehensive tax reform is the top priority for America’s retailers.”

The tax reform proposal simplifies the tax code by reducing all seven income brackets into just three. The three income brackets will be taxed at 10 percent, 25 percent, and 35 percent. The proposal didn’t detail exactly what income ranges each bracket will cover.

“Tax reform is probably to me and our members, especially our small business members, the most important thing,” Ortiz said. “It will give businesses the opportunity to hire more people, expand their operations, and invest in their communities.”

The plan reflected many of the same ideas that were detailed in a tax blueprint released by congressional leaders last year. The blueprint was also designed to simplify the tax code and reduce rates.

Republicans made healthcare reform a major rallying cry during the last administration. President Obama completely overhauled the health insurance industry through the Affordable Care Act. A recent Republican bill to repeal and replace the law failed even with backing from the president.

“The one disappointment that we have was Congress’ failure to repeal and replace Obamacare, but we’re very encouraged by their determination to keep working on that,” Mozloom said. “There appears to be some kind of deal that might satisfy the various blocks in Congress.”

President Obama oversaw a massive expansion of workplace regulations aimed at protecting workers. The business community and other critics contested the regulations put undue burdens on businesses while actually hurting the very workers it was meant to help. Trump has already upended a number of Obama-era regulations.

“We couldn’t be more supportive of what’s going on,” Ortiz said. “Unfortunately the regulatory reform side probably isn’t getting as much attention in the media but it really should be. I think there’s been a lot of issues that have been addressed already.”

The National Association of Manufacturers (NAM) estimated that total federal regulatory costs reached $2 trillion in 2012 alone. Business owners commit a lot of time and money to ensure they are not in violation of the law. NAM launched an ad campaign Thursday thanking the president for his push to reduce regulatory burdens.

“Imagine if we could save just half of that in some of these rollbacks,” Ortiz said. “That would be an enormous boon to the economy having those dollars being invested back into the business.”

Trump has been able to scrap some regulations just through executive orders alone. The president reduced offshore drilling restrictions and ordered federal agencies to withdraw two regulations for every new one implemented. He also signed a bill ending a rule that blacklists companies with labor violations from getting federal contracts.

“Franchise owners are relieved by the far greater level of regulatory certainty so far,” Michael Layman, vice president for regulatory affairs at the International Franchise Association (IFA), told InsideSources. “The anti-small business regulations coming out of the Obama administration were bewildering.”

The business community warned the blacklisting rule gave unions an unfair advantage when negotiating. They could cause a lot of headaches just by accusing a company of a labor violation. Layman noted franchises have been particularly concerned about the last administration expanding a regulation known as the joint-employer standard.

“We’re very hopeful the administration and Congress will cleanup the previous administration’s joint-employer mess,” Layman said. “That issue continues to plague businesses of all kinds well beyond franchising because of the uncertainty and increasing liability that grows out of that issue.”

The joint-employer standard determines whether an employer is responsible for the employees and labor liabilities of a company it contracts with. Employers take on a lot of legal burdens and costs when they become joint-employers. The Obama administration drastically changed how the standard is determined.

The joint-employer standard used to be determined based on whether a company has direct control over the employees of the other. The new standard looks at indirect control, which critics argue is too vague. The American Action Forum,  a center-right nonprofit, found the new standard could cost 1.7 million private sector jobs.

Trump has also managed to fill a vacant seat on the U.S. Supreme Court. Justice Neil Gorsuch was confirmed April 7 despite resistance from lawmakers on the left. He prides himself on being a constitutional originalist as opposed to a judicial activist.

“The president’s selection of Neil Gorsuch for the Supreme Court was a big win for small businesses,” Mozloom said. “We were the lead plaintiff in the landmark NFIB vs. Sebelius case which upheld Obamacare. We were the ones trying to overturn it. Our members learned a very hard lesson that day, that one Supreme Court justice makes a big difference.”

Gorsuch isn’t the only nomination from the administration that businesses support. Trump has filled his cabinet with appointees that share his economic agenda. Alexander Acosta being confirmed as labor secretary is one of the more critical appointments for businesses since he will be overseeing national workforce regulations.

Tom Price, the secretary of Health and Human Services, is also likely to play an important role when it comes to healthcare reform. Treasury Secretary Steven Mnuchin is also important to the business community as a key figure in reforming the tax system.

Labor unions have been far less enthusiastic about Trump. They have helped to organize national protests and grassroots campaigns against him. The president was able to gain some union support for his decision to relaunch construction on the Keystone Pipeline and other projects that help create jobs.

RILA is a trade association that represents retailers. NFIB represents 325,000 small businesses from across the country. IFA represents over 733,000 franchise establishments. NAM represents small and large manufacturers in every industrial sector. JCN is a coalition consisting of over a hundred trade association and business groups.

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Gross Domestic Product (GDP) showed only slight growth Friday in the first quarterly report since President Donald Trump entered office.

GDP tracks the total dollar value of all goods and services produced over a specific time period. It jumped in the third quarter of last year to 3.5 percent after being stuck around one percent. The Bureau of Economic Analysis (BEA) found in its advance estimates that it only increased by 0.7 percent annual rate in the first quarter of 2017.

“The increase in real GDP in the first quarter reflected positive contributions from nonresidential fixed investment, exports, residential fixed investment, and personal consumption expenditures (PCE), that were offset by negative contributions from private inventory investment, state and local government spending, and federal government spending,” the report states. “Imports, which are a subtraction in the calculation of GDP, increased.”

Trump entered office promising to help both the businesses community and workers. His plan to decrease regulations and lower taxes has prompted optimism in the economy. House Ways and Means Committee Chairman Kevin Brady argues the report doesn’t reflect poorly on the administration but rather shows how important it is those policies get implemented.

“This report underscores the urgent need for pro-growth tax reform,” Brady said in a statement. “Now, for the first time in over 30 years, the House, Senate, and White House are moving forward together with comprehensive tax reform that will create jobs, increase wages, and increase America’s competitiveness.”

The Federal Reserve has been slowly raising interest rates in recent months in response to improving economic conditions. Interest rates were kept low for the last decade to help stimulate the economy after the most recent recession. The Economic Policy Institute (EPI) warns against raising rates given the lackluster growth.

“The economy’s weakness in the first quarter of 2017 was broad-based,” EPI said in a statement. “Between the broad-based economic weakness and continued below-target inflation, today’s report provides a powerful signal that the Federal Reserve should not raise rates in the next Federal Open Market Committee meeting.”

GDP displayed slow growth throughout the years following the recession, but it still remained at least at one percent over the past few years. The latest report reflects the lowest numbers in about three years. The economy hasn’t fully recovered since the last recession, but over the last couple of years, it has shown improved employment and economic growth.

The BEA report reflects the advanced findings for the first quarter of this year. The report is based on source data that is incomplete or subject to further revisions. The finalized first quarter report is scheduled to be released on June 29.

The Bureau of Labor Statistics (BLS) has tracked steady employment growth over the last couple of years with the economy finally starting to strengthen. The most recent jobs report, however, showed that the labor market only grew slightly with an additional 98,000 new jobs. The previous jobs reports over the last year usually saw greater job growth closer to 200,000.

Trump has focused much of his presidency on protecting domestic workers from unfair foreign competition. He has primarily targeted trade and immigration as problematic areas. Some on the right warn that too much economic protectionism could even hurt the same domestic workers it’s meant to help.

Trump released a summary of his plan to overhaul the tax system Wednesday. The president hopes to simplify the tax code and lower rates. The plan reflected many of the same ideas that were detailed in a tax blueprint released by congressional leaders last year.

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President Donald Trump finally managed to get his labor secretary confirmed Thursday with the process overcoming several delays and setbacks.

Alexander Acosta was nominated to become the next labor secretary Feb. 16. The position remained one of the last major nominations to be filled. The Senate finally reached the end of the process by voting 60 to 38 to confirm the nomination.

The Department of Labor plays a critical role in issuing and enforcing workplace regulations. Acosta is now essentially responsible for overseeing the national workforce. He will likely prove to be critical in implementing the administration’s agenda since so much of it is focused on workers and business.

“Mr. Acosta has excellent credentials, and is well qualified for the position,” Republican Sen. Lamar Alexander, chairman of the Senate labor committee, said before the vote. “He realizes a good paying job is critical to helping workers realize the American dream.”

Those opposed contest that he is just not the right person to lead the department. Democratic Sen. Patty Murray expressed reservations on the Senate floor Wednesday. She believes his background shows he may be overly influenced by political pressures.

“We need a secretary of labor who will remain committed to core principles of the Department of Labor,” Murray, ranking member of the labor committee, said during the hearing. “Someone who will prioritize the best interests of our workforce, enforces laws that protect workers’ rights, safety, and livelihoods, and seeks to expand economic opportunities for workers and families across the country.”

Acosta has been seen by some opponents as a more moderate choice for labor secretary. CKE Restaurants President Andy Puzder was originally nominated for the position by eventually dropped out. Murray agreed, but added not being Puzder shouldn’t be the standard.

Acosta has also received support from the business community. The National Retail Federation believes he will bring balance back to what it sees as an overly politicized department. The International Franchise Association was encouraged by his views that labor regulations have become an unnecessary burden for businesses.

Labor unions were much less encouraged by the nominee. The AFL-CIO argued that his recent testimony before the labor committee March 22 raised serious concerns and doubts. The Service Employee International Union (SEIU) added his testimony didn’t indicate he’d be the kind of leader working families need.

Former President Barack Obama pursued much of his agenda through the department. His administration worked to strengthen worker rights, but those opposed argue he did little to help workers while putting unnecessary stress on employers.

Acosta is an attorney who has served as dean of the Florida International University College of Law. Former President George W. Bush previously appointed him to serve on the National Labor Relations Board (NLRB). He has also been an assistant attorney general and federal prosecutor.

Acosta expressed concern during the earlier committee hearing that opportunities are dwindling for workers. He noted his immigrant parents could always find work despite being poor. He argued that there needs to be a better balance between protecting workers and regulatory burdens.

Those opposed to the last administration also hope the new labor secretary will help bring balance back to the department. The Competitive Enterprise Institute noted in a coalition letter the department imposed $55.7 billion in regulatory costs on employers during the last administration.

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House Republicans hosted a hearing Thursday to explore what policies lawmakers should be pursuing to encourage economic growth.

The economy has shown considerable improvement over the last year. It still faces lingering challenges from the last recession that could be hindering economic growth. The Economic Growth, Tax, and Capital Access Subcommittee hosted the hearing to examine what causes economic growth, and the limits that currently exist.

The recession was caused by the financial and subprime mortgage crisis of 2007. It was followed by an unusually prolonged economic recovery. Expert witnesses suggested a number of policy solutions that could help the economy finally see robust growth.

“Turning to present day trends, 2017 has seen a widespread but tempered increase in confidence among small business owners regarding the economy and overall trends in business investment,” testified Andrew Sherman, a partner at Seyfarth Shaw. “Business owner optimism has increased in part due to promises of tax reform, regulatory reform, and the strength of the capital markets.”

Sherman has written books and held lectures on entrepreneurship. He adds lawmakers should reduce regulatory requirements so banking institutions can more easily provide loans to small businesses. He also suggests reforms should reduce regulations and address problems with labor productivity.

Former President Barack Obama oversaw the recovery throughout his time in office. He was able to eventually see steady economic gains in his final years. President Donald Trump has focused his presidency thus far on resolving the economic issues still hindering the country.

“Over the last 8 years, economic growth has been stagnate,” Heritage Foundation distinguished fellow Stephen Moore testified. “Wages are, for the most part, flat, and many on the left believe our days of sustainable three percent growth are over.”

The Gross Domestic Product (GDP) is the primary indicator for measuring economic growth. The GDP tracks the total dollar value of all goods and services produced over a specific time period. It jumped last year to 3.5 percent after being stuck around one percent.

“I believe that the hope of human achievement and policies that allow for us to produce and grow, free of government intervention will break all expert predictions,” Moore said. “This is all possible if Congress enacts policies that reduce regulation, lower taxes, and empower small businesses.”

Not everyone is convinced slashing taxes and regulations is the right approach. Center on Budget and Policy Priorities economist Chad Stone urged a more deliberate approach since both can be beneficial. Safety regulations, for instance, may impose additional costs on businesses, but they also improve workplace conditions and safety.

“Health, safety, and environmental regulations can impose costs on businesses that may slow measured GDP growth,” Stone said. “But any such costs must be compared with the benefits of better health, safer workplaces, and a cleaner environment that may not be captured in GDP.”

Stone adds the positive impact of tax cuts is often exaggerated in relation to economic growth. Republican leadership has made tax reform a priority. Trump introduced a tax plan Wednesday that focused on lowering rates and simplifying the system.

The hearing also focused on how small businesses help further economic growth. Sherman notes that small businesses have been reporting a decline in economic uncertainty in recent months but that they still are having trouble accessing affordable financing.

“We are all aware that small and emerging businesses are the backbone of our country and a significant engine for the creation of new jobs,” Sherman said. “Many small businesses are forecasting significant increases in revenue for 2017 and 2018.”

Stone counters that small businesses might not be as critical as some believe. He argues that the age of a business is a much more significant factor. He adds that small businesses aren’t necessarily a critical driver of growth, but rather startups and new businesses are.

“Research over the last several years has modified the longstanding claim that small businesses are the engine of job growth,” Stone said. “This research shows that the age of a business matters more than its size as a contributor to job growth, although new companies are typically small to start with.”

Sherman also urged lawmakers to look more closely at technological changes facing the economy. Businesses have been steadily adopting technology that allows them to replace labor with machines. Automation is nothing new, but improved technology and increased labor costs have threatened to displace many more workers in the years ahead.

The Congressional Budget Office (CBO) found in a recent budget outlook report that workers face slow wage and labor market growth over the next couple of decades. More people are also expected to dropout of the workforce. The outlook is based on current laws and could change as lawmakers enact reforms.

The Bureau of Economic Analysis (BEA) is scheduled to release its advanced estimate for GDP this year on Friday. Estimates are calculated on a quarterly basis throughout the year. The report is expected to paint a good picture of how the economy is doing under the new administration.

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The White House detailed during a press conference Wednesday how it hopes to reform the tax code in order to promote economic growth.

President Donald Trump has made tax reform one of his top priorities. The administration hopes a simplified and reduced tax code will help spur economic growth. Treasury Secretary Steven Mnuchin and National Economic Council Director Gary Cohn detailed the plan during the press conference.

“This is quite a historic day for us, and one that we’ve been looking forward to for a long time,” Cohn told reporters. “We have a once-in-a-generation opportunity to do something really big. President Trump has made tax reform a priority, and we have a Republican Congress that wants to get it done.”

Cohn adds the plan will simplify the tax code by taking all seven income brackets and reducing them to just three. The plan will also lower rates for upper and middle-income earners. Additionally, it is designed to end the death tax and repeal the alternative minimum tax to further simplify the system while reducing burdens on taxpayers.

“This isn’t going to be easy, doing big things never is,” Cohn said. “We will be attacked from the left, and we’ll be attacked by the right. But one thing is certain, I would never bet against this president. He will get this done for the American people.”

Cohn adds the plan is also designed to promote capital investments to spur economic growth. The plan will return the top capital gains tax rate and dividend tax rate to 20 percent by repealing the 3.8 percent tax that was imposed to support the Affordable Care Act.

The tax code hasn’t been overhauled in any significant way since 1986. The tax system is incredibly difficult to reform because of how complex and politically divisive it is. Carnegie Mellon University Prof. Jeff Kupfer notes that having the administration involved is critical to actually getting something passed.

“I think it’s always productive when the administration leads in any tax reform effort,” Kupfer told InsideSources. “It’s essential for getting tax reform over the goal line to have the administration committed out front with senior leadership and the president involved.”

House Speaker Paul Ryan and Rep. Kevin Brady introduced a blueprint last year which included many of the same provisions. The blueprint was also designed to simplify the tax code and reduce rates. The border adjustment tax is one major provision in the blueprint that wasn’t mentioned during the press conference.

The border adjustment tax has become a major point of contention. It is a value added tax levied on imported goods. It is essentially applied when a product is produced in a foreign country but sold domestically.  The provision has split those on the right, including many who support the blueprint generally.

Trump announced the press conference while signing an executive order last week. He noted at the time that his administration has already been laying the groundwork to get tax reform done.

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Federal programs designed to help displaced workers might need to be reformed to address rapid changes in the current labor market.

President Donald Trump helped to renew interest in the working class during his campaign. His promise to help struggling workers resonated with many voters. Federal training programs were established to help those very workers, but changes to the labor market may underscore the need for reform.

The Department of Labor (DOL) oversees the bulk of these federal programs in coordination with state agencies. The programs are designed to help displaced workers by providing them skills that companies actually need. These programs are now faced with the question of whether they are actually effective.

“Who are you retraining and for what purpose, on what level of skills?” asked Prof. Samuel Bacharach, who serves as the director of the Institute for Workplace Studies at Cornell University. “I think we have to deal with these fundamental issues. Otherwise, we’re going to keep giving people training on this and training on that and ten years from now they’ll outgrow the skills we gave them.”

The federal government has multiple job training programs designed around various needs. The Employment and Training Administration provides various training and employment services. Job Corps provides free vocational training to younger adults. The Adult and Dislocated Worker Program also provides workplace training.

The Government Accountability Office (GAO) found in a 2011 report that the federal government spends about $18 billion annually on these programs. The report also states nine federal agencies run their own job training programs. A major issue facing the current system is whether the programs are providing the skills employers actually need.

“Individuals are not being trained for jobs that they’re able to find employment in,” Heritage Foundation research fellow Dr. David Muhlhausen told InsideSources. “The idea that the federal government is going to train people who have been laid off or displaced in some way just hasn’t worked out.”

The Workforce Investment Act consolidated most job training programs when it was enacted in 1998. The act has since remained the primary legislation for employment and training programs. It is the latest in a series of laws that date back to the New Deal era.

“The worst thing is to have people fund the programs, and then at the end of the day, what they’re being trained for, there’s no jobs,” Boston University Prof. Fred Foulkes told InsideSources. “It’s a big problem because a lot of jobs are getting eliminated or changed with how technology is going.”

Tech and other emerging industries are in an increasing need for advanced skills and talents. Industry experts have argued a lack of needed skills among domestic workers is becoming a growing problem. Some industries have become increasingly reliant on high-skilled visas like the H-1B program.

“We don’t have the people, and we can’t get enough H1-B visas,” said Foulkes, who also serves as the director of the Human Resources Policy Institute at Boston University. “Life sciences can’t find enough people,  software companies can’t find enough people, and the type of people who are qualified, if they’re from outside the area, they have a real problem coming in.”

Foulkes adds the lack of needed skills is one factor pushing companies overseas. Silicon Valley in California has been at the forefront of the current technological renaissance. India and other countries across the globe are working to become the next major center for technology by promising companies skilled workers.

The federal government has many potential paths to reforming and improving these programs. One solution is to ensure different groups are effectively coordinating with each other. The federal government can increase efforts to work with state agencies and private organizations.

“When you offer training, mentorship, and things like that, it’s important to do it for jobs that actually exist and someone is hiring,” Foulkes said. “The best thing that can happen is a real partnership between employers who have jobs, community colleges to do some training, and the government.”

Some have argued employment training programs should be handled by the states. State policymakers have localized knowledge that may help them more effectively implement the programs. States have diverse economies that have their own shortfalls and labor market needs.

“The federal government should get out of it, and let the states handle these programs,” Muhlhausen said. “These programs need to tailor the training to the actual jobs that are in demand. The federal government doesn’t do that well.”

Foulkes agrees states should do more to administer the program, but believes the federal government can still play an important role. The federal government could advise states and highlight best practices. Some others believe the government shouldn’t even be involved at all.

“The vast majority of people looking for jobs, looking for skills, do it themselves,” Cato Institute scholar Chris Edwards told InsideSources. “Individuals want skills, individuals want training, individuals want to earn more money, they want to have a successful career so they go out and get training and they add to their skills themselves.”

Edwards has researched and written about federal jobs training programs. He adds that the private-sector is already providing job training services. Coursera and other online education courses, for instance, have expanded access to programs for skills development.

The GAO more recently looked specifically at the Workforce Investment Act which encompasses most of the government programs. The report couldn’t even determine whether these programs worked at all. It recommended the department take additional steps to improve how state agencies report data.

“They pretty much find that these programs overall have very little effect on improving income or employment prospects,” said Muhlhausen, who studies the effectiveness of federal social programs. “When you just limit it to people who are displaced workers that are getting retrained for a new career, these programs often have a harmful impact.”

Congress is unlikely to enact any meaningful reforms anytime soon despite the renewed interest in helping workers adapt to a changing economy. Republican leaders have already taken on an ambitious agenda between healthcare and tax reform. Muhlhausen adds lawmakers also tend to reauthorize the programs without much thought over whether they work.

“Congress doesn’t really want to reform these programs,” Muhlhausen said. “They tinker around the edges, they change the name of the program, change how the funding streams operate, but the same services are being provided for the last several decades.”

Muhlhausen adds lawmakers will also be unlikely to tackle reform since they reauthorized the programs as recently as 2014. Some lawmakers have still been pushing to reform and improve the programs. Democratic Rep. Doris Matsui, D-Calif.,  introduced a bill March 16 that would provide training grants for workers displaced by automation.

“Republicans like to support jobs training programs, or they like to support the idea of job training programs because it sounds pro-business,” Edwards said. “The problem is, I don’t think Republican politicians, they like the soundbites, but they haven’t really looked at the actual details and history of these things. They don’t work.”

The Wagner-Peyser Act established the first nationwide employment service. The act helped coordinate local public employment offices which had been helping displaced and struggling workers. Edwards notes rapid labor market changes and displaced workers are not a new phenomenon.

“There’s always been a rapid replacement of jobs in many professions,” Edwards said. “But because we have a market economy, entrepreneurs generally, not just new businesses, entrepreneurs generate whole industries no one ever dreamed of.”

Edwards adds it was just about a century ago when the country went from agriculture to industrial within about two decades. Individuals were able to adapt to the rapidly changing times by developing skills that emerging industries needed.

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