What Happens When Washington Cuts Workforce Development? Ask New York

Newsweek

19 hours ago

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Though the FY2026 budget isn't final, the newly signed One Big Beautiful Bill Act (OBBBA) has already triggered devastating disinvestment in New York's workforce and economic stability.
Rather than supporting cities in their efforts to build inclusive economic growth, Congress and President Donald Trump have advanced sweeping cuts through OBBBA, eliminating Job Corps (temporarily blocked by the courts), slashing the Department of Labor's budget by 35 percent, and gutting Medicaid.
The timing could not be more harmful. Our city and state are making investments in green infrastructure, clean energy, life sciences, and housing. But Washington is pulling critical support from under us. The policies enacted in OBBBA undermine our ability to train workers, support economic mobility, and care for vulnerable communities.
President Donald Trump answers questions while departing the White House on July 11, 2025, in Washington, D.C.
President Donald Trump answers questions while departing the White House on July 11, 2025, in Washington, D.C.Nationally, the law cuts $715 billion from Medicaid and ACA programs. In New York, over 6.9 million residents rely on Medicaid, including 2.1 million adults through ACA expansion. Hospital reimbursements will shrink. Safety-net providers already operating on razor-thin margins will be pushed to the brink. In New York City, over 1.5 million residents could see a drop in access to care, just as our health care system is still recovering from the pandemic.
OBBBA also strips federal support from New York's Essential Plan, which covers 725,000 lawfully present immigrants. Unless New York finds $4 billion annually, coverage losses will follow, disproportionately affecting working adults who keep the city running.
And then there's Job Corps. For decades, Job Corps has helped out-of-school youth—especially youth of color—enter the workforce. In New York City, where income inequality remains among the highest in the nation, it's been a pillar of inclusive opportunity. Its elimination would leave thousands of young New Yorkers without a foothold in the economy.
New Medicaid work requirements would add red tape with little benefit. Adults aged 18–64 must repeatedly verify employment or exemptions. Up to 1.5 million New Yorkers risk losing coverage, not for failing to work, but for failing to navigate bureaucracy.
This provision will overwhelm a municipal workforce that has seen hiring freezes and attrition, particularly in frontline human services and child care administration. Who will support these recipients when the system demands more documentation but offers no added staff? New York City's public assistance infrastructure—especially TANF and subsidized child care—is already strained by backlogs and delays. These new mandates will push it to the breaking point.
Families are losing access to both income support and the services that make work possible, like child care, job placement, and case management. This is disinvestment in America's future, and in New York's.
SNAP, Medicaid, and workforce development are economic drivers. SNAP alone injects $7.8 billion into New York's economy annually. Workforce training reduces dependency on public benefits, strengthens small business growth, and boosts tax revenue. In New York City, Workforce Innovation and Opportunity Act (WIOA)-funded career centers, youth employment contracts, and pre-apprenticeship pipelines are already being destabilized by the cuts enacted in OBBBA.
New York has long been a model for inclusive economic growth and smart workforce investments. But no amount of local innovation can offset a $715 billion federal retreat from health care or the gutting of job training infrastructure.
What's equally alarming is the absence of a coordinated, targeted response from City Hall and Albany. There has been no unified strategy to protect the infrastructure of opportunity that so many New Yorkers rely on. A hollowed-out municipal workforce cannot respond effectively. Meanwhile, community-based organizations are once again left to absorb the shock, expected to do more with less, even as they face chronic delays in city payments and no assurances of sustained funding. Instead of mobilizing to mitigate the damage, local leadership has offered silence, short-term patches, or fragmented efforts that fail to meet the moment.
At the same time, we find ourselves jousting over mayoral frontrunners and watching the early moves of gubernatorial politicking, while too many New Yorkers are reeling from the dismantling of the middle class, the disappearance of middle-wage jobs, and the erosion of public systems. The disconnect between political theater and lived reality is widening. Debates over who wins the next election will mean little if there's no workforce left to train, no safety net left to rebuild, and no path forward for the people who keep our city running.
Congress must be held accountable, and New York's delegation must be unified, visible, and vocal. These cuts are direct threats to job seekers in East New York, to immigrant families in Queens, to union apprentices in the South Bronx, and to working parents in Buffalo and Rochester who rely on Medicaid to stay healthy enough to work.
Let us not confuse austerity with a strategic approach. Investing in people is not charity. It is how economies grow.
Gregory J. Morris is CEO of the NYC Employment and Training Coalition.
The views expressed in this article are the writer's own.