On the ground, the story feels different. Many Minnesotans experience a daily reality marked by high prices, shrinking financial cushions, and a feeling of being stuck in their jobs. And yet, as they read positive headlines and see others thriving, many are left with a pervasive sense that the economy is working well — just not for them.
And economists say both impressions are true, rather than contradictory. Minnesota isn’t experiencing one post-pandemic recovery. It’s experiencing two.
“The top 10% of income earners are responsible for 50% of consumption,” said Tyler Schipper, associate economics professor at the University of St. Thomas. Moody’s Analytics recently reported that top earners now account for a higher share of spending than any point since it started tracking the figure in 1989.
“So when we measure economic activity — GDP, retail sales — we’re really observing the behavior of people who are doing relatively well.” Aggregate data like these indicators “doesn’t give every household an equal vote,” he said.
Measures that treat each person equally, regardless of income, tell a different story. Consumer sentiment surveys measuring how people feel about the economy show falling confidence. The University of Michigan’s widely watched confidence index dropped 4.9% from October to November and is down nearly 30% from a year earlier. The last time Americans, on average, expressed a net positive view of the U.S. economy was February 2020.
That divide, between strong top-line indicators and sinking household outlooks, can be a hallmark of what is sometimes called a “K-shaped” economy. It’s not a perfect metaphor, but it has become a useful visual shorthand: one group climbing upward, another slipping or stagnating.
“When averages look good but half the population feels terrible, that’s not a contradiction. It means the income distribution has widened,” Schipper said.
That gap can be shown using a number of indicators and trend lines. But it can also be seen in the lived experience of Minnesotans who find themselves on opposite sides of this gulf.
Barry: “It’s not my economy”
Barry Page, 68, earns over $900 a month in Social Security and pays more than $1,000 in rent. He has been looking for work since January, when an arrest — later deemed improper with the charges being dismissed — led to the loss of his job as an industrial painter. Despite the case’s dismissal and expungement, he says the record still haunts his job applications and background checks.
“I’ve been trying to get a job for almost a year,” he said on a recent afternoon while waiting for the Metro Green Line at a University Avenue fast-food restaurant in St. Paul and picking at his french fries. “They look at that computer and they say, ‘He’s too old,’ and that’s that.”
His monthly expenses — rent, groceries, utilities — exceed his income before he has bought food for the week. “If I put all my Social Security check toward rent, I can’t pay my gas bill, my electric bill. I have to have a job.”
A fast-food meal that once cost $8–9 now runs him $15. “You get what they give you,” he said, holding up a sandwich he described as “salad with bread.”
He’s resigned himself to paying prices he never would have two years ago. But he’s still angry that companies are able to charge those high prices, because higher earners can afford them.
“Society sets prices for them, not us. They can afford it. We’re struggling to live in their economy,” he said, referring to higher-income Minnesotans. “It’s not my economy.”
Page relies on friends, including a pastor and a friend in Washington, D.C., that he’s currently waiting on a call from, to keep him afloat. “If it wasn’t for them, I’d be on the streets,” he said.
For him, like millions of other Minnesotans, the economy isn’t abstract. It isn’t a graph. It’s an increasingly unreliable ladder, where the rungs feel less stable today than they did the day or the year before.
Joe: “We’re tightening up, but we’re fine.”
Twenty miles away, on the other arm of Minnesota’s economic trajectory, is Joe Mueller, a real-estate agent and owner of a growing rental portfolio. He said his companies collectively gross around $1.25 million a year, though his net take-home is likely less than half that. He describes himself as someone who once “came from nothing.” He used to sell real estate out of a rusted $400 pickup that he’d park around the block from showings.
Now, Mueller occupies a financial reality most Minnesotans will never see, as a successful real estate agent and owner of The MOVE Group at RE/MAX.
As prices have climbed, he and his wife have trimmed some discretionary spending — ending vacations earlier, opting for cheaper flights, being “mindful of waste.” But those adjustments aren’t necessary, but rather precautionary.
“We don’t stress over the price of eggs,” he said. “That’s a blessing, and I recognize that it’s not the same for everyone.”
When prices rose, he didn’t go without; he optimized his spending to match the happiness it brought him and his family. “If you can do a $5,000 vacation for $3,000 and still get 90% of the experience, that’s great,” he said.
When asked about economic worry, he rejected the word. He prefers “prepared.” “Every economy has cycles,” he said. “You adjust. You weather it. You don’t pull the fire alarm.”
Mueller’s experience is emblematic of high-earning Minnesota households. Like everyone, they recognize conditions have shifted compared to before the pandemic. But they are able to recalibrate their spending and lifestyle from a position of confidence, not desperation.
More broadly, and in stark contrast to Page’s outlook, for Mueller, the economy is not a threat. It’s a system that still works, as long as you stick to the right strategies, maintain the right buffers, and stay in the right mindset.
Why economists say these two realities can coexist
Mueller and Page are not symbols — they’re Minnesotans living through the same macroeconomic conditions but experiencing them in fundamentally different ways.
Mueller’s household has buffers — equity in real estate, cash flow from rentals, diversified income, and enough discretionary spending to adjust when he needs to.
“When things tighten, we tighten,” he said. “If a recession comes, we’ll weather it. We live below our means, and we’re willing to dial back the extras.”
Page’s household has no buffers and no margin to absorb a surprise.
“When I was working, I was good,” he said. “I was bringing home $2,500 to $3,500 a month. But now — now I’m getting $967 and rent is $1,035. I ain’t got nothing left.”
How can their experiences be so disparate, and why are their trajectories diverging instead of converging?
Economists say the trend of divergence is no longer simply an artifact of the pandemic or a short-term mismatch between supply and demand. Instead, it reflects a deeper pattern of different groups moving through fundamentally different economies.
Perhaps most alarming for those who have held traditionally middle-class jobs — police officers, teachers, manufacturing supervisors, and many others — is that this is no longer a low-income vs. high-income dichotomy. Labor market trends, combined with inflation, means many middle and upper-middle-income households are struggling to make ends meet and are only one layoff or emergency from slipping down the rungs of the income ladder.
The orthodox view of Minnesota’s economy — low unemployment, steady job growth, high labor-force participation — is not inaccurate. But those averages have masked a widening split within the state’s households, one that economists say has been building quietly for years and is now showing up more plainly in certain data points.
“You really can’t talk about one economy anymore,” said Kjetil Storesletten, a macroeconomist at the University of Minnesota. “You have multiple trajectories depending on assets, education, and where you sit in the labor market. The aggregate number is just the weighted summary of all of those realities.”
Those “weights” matter. When higher-income households — who both earn more and spend far more per person — continue to spend, the economy’s overall indicators look resilient even if many other households are straining to just keep up with the basics.
“We observe an aggregate number, but behind it are many separate distributions moving differently,” he said. “Averages can hide enormous disparities.”
This story was originally published by MinnPost and distributed through a partnership with The Associated Press.
Copyright 2025 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.
On Feb. 14, 2022, a Starbucks manager pulled Michaela Sellaro aside for a meeting.
Just a few weeks earlier, Sellaro and a group of her fellow baristas at the coffee shop at 2975 East Colfax Ave. in Denver informed the company’s CEO that they planned to organize a union.
In the early afternoon, at a table by the windows, the store and district managers sat Sellaro down for a chat. The message, though light and breezy, was clear: “You know Starbucks’ stance is that we don’t need a union to represent our partners,” Kaylin Driscoll, the district manager, told Sellaro, according to a recording reviewed by The Denver Post.
Relationships with leadership will degrade if employees vote to organize, the managers told her. Promotions could be nixed. Benefits might change.
“The dynamic of having those conversations will change with a union,” said Ariel Rodriguez, the store’s manager, in the recording. “I have no personal desire to be part of a store that has to work through a union to have those conversations with you. I have zero interest in that.”
The East Colfax store, which the company has since closed, represents one of 18 Starbucks cafes in Colorado that have unionized since 2022, despite the Seattle-based coffee giant’s well-documented union-busting activity. What started with one unionized store in Buffalo, New York, in 2021 has blossomed into a nationwide movement encompassing 640 locations and thousands of workers around the United States.
Union supporter Pete DeMay of Chicago chants into a bullhorn along with other picketers during a labor organizing action at the Starbucks location at 2975 E. Colfax Ave. in Denver on Friday, March 11, 2022. (Photo by Eric Lutzens/The Denver Post)
Starbucks has nearly 18,300 locations, company-operated and licensed, across the U.S. and Canada. So far, despite the rapid growth in organizing, fewer than 4% of Starbucks workers are employed in unionized stores.
Starbucks has fought these efforts tooth and nail along the way. The National Labor Relations Board, which regulates private sector union activity in the U.S., has found the company illegally fired workers in response to organizing, closed stores because of union votes and engaged in widespread unfair labor practices designed to quash workers’ efforts.
The coffee conglomerate is the biggest violator of labor law in modern history, according to Starbucks Workers United, the national union representing company workers. The NLRB and its judges have found Starbucks has committed more than 500 labor law violations, the union says. Workers have filed more than 1,000 unfair labor practice charges, including more than 125 since January. More than 700 unresolved charges remain.
Despite the hundreds of union votes over the past four years, baristas are still working without a contract. This month, 92% of union workers voted to authorize an open-ended unfair labor practices strike ahead of the holiday season. The vote comes after six months of Starbucks “refusing to offer new proposals to address workers’ demands for better staffing, higher pay and a resolution of hundreds of unfair labor practice charges,” the union said in a news release.
On Nov. 13, more than 1,000 workers — from 65 stores in more than 40 cities, including Colorado Springs and Lafayette — walked off the job. The union said it was “prepared to continue escalating” its strikes if the company failed to deliver a new contract.
“Union baristas mean business and are ready to do whatever it takes to win a fair contract and end Starbucks’ unfair labor practices,” said Michelle Eisen, a Starbucks Workers United spokesperson and 15-year veteran barista. “We want Starbucks to succeed, but turning the company around and bringing customers back begins with listening to and supporting the baristas who are responsible for the Starbucks experience.
“If Starbucks keeps stonewalling, they should expect to see their business grind to a halt. The ball is in Starbucks’ court.”
The union’s push comes amid a wave of public support for organizing efforts. More than two-thirds of American adults approve of labor unions, according to Gallup polling, a level last reached in the 1950s and early 1960s. Support remains especially strong among young people — a demographic common for Starbucks baristas.
Starbucks representatives declined an interview request for this story. Sara Kelly, Starbucks’ chief partner officer, told employees in a letter this month that the company had bargained in good faith with the union, reaching more than 30 tentative agreements on full contract articles.
“Our commitment to bargaining hasn’t changed,” Kelly wrote. “Workers United walked away from the table, but if they are ready to come back, we’re ready to talk. We believe we can move quickly to a reasonable deal.”
Starbucks, she said, remains the best job in retail, paying, on average, $30 per hour for hourly workers once benefits are factored in.
The first Colorado union shop
But employees at Colorado’s first unionized cafe quickly learned the extent to which Starbucks would go to dissuade organizing efforts.
Harris didn’t know much about labor organizing, but she was intrigued. She and her colleagues were sick of the low compensation, of underscheduling and understaffing, and of not learning their weekly schedules until the night before.
Harris connected with the Buffalo workers over Twitter, and the resulting conversations helped launch the first Starbucks union efforts in Colorado.
Many of her colleagues were scared. One quickly told management about the plans.
Within a week, a rarely seen district manager suddenly showed up at the store, Harris said. Management organized an hour-long meeting about how the union was a bad idea, she said.
“They laid it on thick,” Harris said.
The day the workers officially filed with the NLRB, the Marshall fire broke out in Boulder County. As the blaze raged in Superior and Louisville, the Starbucks employees continued to work. Several staffers lost their own homes or were forced to evacuate.
Harris said she got a call that night from her manager, asking if she was OK. Then she said she was told to be at work first thing the next morning.
“It was a total exploitation of us,” Harris said.
As the vote neared, Starbucks amped up its anti-union activity, she said. Management initiated more two-on-one meetings with staff members. For many of the teenage baristas, this represented one of their first jobs. And here leadership was telling them that they wouldn’t be able to transfer stores or enjoy the perks that nonunion employees would receive, such as credit card tips.
Len Harris fires up the crowd during a rally at Trident Booksellers and Cafe in Boulder on Thursday, July 25, 2024. Harris helped to organize the first unionized Starbucks in Colorado, in Superior, before she was fired. (Matthew Jonas/Boulder Daily Camera)
“The individual intimidation was infuriating beyond belief,” Harris said. “I was sick to my stomach that they were taking advantage of these younger workers to terrify them.”
An executive flew in from Seattle and observed staff at work for weeks, Harris said. Management started cutting workers’ hours.
In April 2022, 12 of the 14 employees at the Superior location voted in favor of forming the union. The company, though, refused to negotiate with the newly formed body. So they went on strike in November, shutting down the store for the entire day.
The following day, Starbucks fired Harris, citing a policy about handling cash that she said she had never heard of. An administrative law judge with the NLRB later found the company had illegally fired Harris based on her union activity. She’s still waiting for tens of thousands of dollars in court-ordered back pay.
“I feel like I’ve gotten a peek behind the curtain to the levels of depravity that the company will sink to to take advantage of their employees,” she said.
The Starbucks playbook
The tactics Starbucks used to try to quash worker organizing in Superior are part of the playbook deployed by company leadership across Colorado and the rest of the country, according to interviews, NLRB documents and news reports.
Emily Alice Dinaro started organizing a Starbucks location on Denver’s 16th Street mall in 2022 because of what she saw as management’s failure to protect staff from violence, drug use and volatile customer interactions that were occurring daily.
After the union activity began, management started enforcing existing rules more strictly, while introducing new edicts, she said. Union supporters were singled out, and these new enforcement steps were used to push people out of the store, Dinaro said.
Out of the 26-person staff, 18 workers signed union cards, while 10 of them signed a letter to the Starbucks CEO informing him of their support. But the implementation of these new rules — concerning dress code, cell phone use and cash handling, among other things — forced widespread turnover at the store, Dinaro said. Only five people ended up voting in the union election, which passed successfully.
Dinaro was fired shortly after the vote over what the company said were repeated violations of its attendance and punctuality policy. In 2024, an NLRB judge ruled that Starbucks had fired her illegally due to her union activity.
“When I first started at Starbucks, I thought they were an outstanding, virtuous company,” Dinaro said. “I’ve come to learn they just have an outstanding PR team.”
Starbucks barista Brenna Bellfield holds roses, a symbol of the labor movement, in front of the unionized East Colfax location of Starbucks in Denver, Colorado, on Saturday, Jan. 2022. (Eli Imadali/Special to The Denver Post)
A Starbucks spokesperson, in a statement to The Post this month, said the company “respects our partners’ right to choose through a fair and democratic process, to be represented by a union or not to be represented by a union.”
But federal judges have repeatedly said otherwise. The NLRB, time and again, has found that Starbucks violated the National Labor Relations Act in dealings with employees and their efforts to unionize.
The coffee giant shuttered a store in Colorado Springs in 2022 shortly after its workers voted to unionize and one day before a requested bargaining date. The NLRB, the following year, ordered Starbucks to reopen that store, along with 22 others around the country, because the company had failed to give notice to labor groups.
The NLRB invalidated another union election at a different Colorado Springs location in 2022, finding that management threatened employees through “highly coercive” questioning and “textbook unlawful interrogation.” One manager gave “dire” warnings to workers that unionized stores would not receive certain benefits, such as pay raises.
In several instances, Starbucks violated federal law by firing Colorado workers over pro-union activities, the NLRB found.
The company has employed these same tactics to dissuade union activity across the country.
Federal labor regulators in 2022 asked a court to force Starbucks to stop the company’s “virulent, widespread and well-orchestrated response to employees’ protected organizing efforts.”
Starbucks has refused to divulge how much it has spent on its response to worker organizing campaigns. A federal judge in 2023 ordered the company to comply with a U.S. Department of Labor subpoena seeking expenditure documents for its investigation into the company’s compliance with the Labor-Management Reporting and Disclosure Act.
“We will not sit idly by when any company, including Starbucks Corp., defies our request to provide documents to make certain they are complying with the law,” Solicitor of Labor Seema Nanda said in a statement at the time.
Howard Schultz, the coffee chain’s billionaire founder, has said the unionization drive felt like an attack on his life’s work. In previous speeches to his employees, he has cast the union as “a group trying to take our people,” an “outside force that’s trying desperately to disrupt our company” and “an adversary that’s threatening the very essence of what (we) believe to be true.”
Sharon Block, a former NLRB member under President Obama and a professor at Harvard Law School, said the coffee giant has used a tried-and-true playbook to stifle union activity. But with weak federal laws and a National Labor Relations Board that has been stunted by the Trump administration, she said, there is little incentive for unscrupulous companies to play by the rules.
“This is a continuing pattern of behavior that sends a signal to the workers that this is a company that will do almost anything to stop them,” she said in an interview.
Starbucks has earned the distinction as a model for unlawful corporate union busting, the Economic Policy Institute, a nonpartisan think tank, wrote in a January article. The National Labor Relations Act lacks teeth, making companies more than willing to accept a few slaps on the wrist in order to achieve their broader goals, the report’s author noted.
“There is no mystery as to why corporations like … Starbucks … violate the (law) with such regularity: Crime pays great dividends, as it produces the desired chilling effect on worker organizing and as corporations consider the law’s paltry sanctions an insignificant price to pay to prevent unionization through fear and disruption,” the article states. “The penalties for violating the (law) are utterly meaningless for multibillion-dollar corporations.”
‘No contract, no coffee’
Despite these aggressive union-busting efforts, Starbucks workers continue to organize in Colorado and across the country.
Unionized shops in Colorado have grown to 17 stores, including five in Denver. More than 640 member stores have joined the cause since 2022, making the drive one of the fastest organizing efforts in modern history, according to Starbucks Workers United.
Now workers want a contract.
The union and the company conducted their first bargaining session in April 2024, meeting monthly that summer. In December, however, the union says Starbucks backtracked on the agreed-upon path forward. Starbucks Workers United accused the company of failing to bargain in good faith.
In April, the company rejected Starbucks’ package. The two sides have yet to return to the bargaining table.
Workers voted overwhelmingly on Nov. 5 to authorize an open-ended unfair labor practice strike. The union on Nov. 13 turned Starbucks’ Red Cup Day — an annual free cup giveaway around the holiday season — into a “red cup rebellion,” forcing the closure of nearly all 65 stores where workers were striking.
Starbucks Workers United said they planned to continue escalating the strike, warning that it could be the “largest, longest strike in company history” if the company refuses to deliver a fair contract.
Colorado Sens. John Hickenlooper and Michael Bennet, along with 24 of their Senate colleagues, wrote a letter this month to Starbucks CEO Brian Niccol, pushing the company to end its “illegal union-busting efforts and negotiate a fair contract with its employees.”
“It is clear that Starbucks has the money to reach a fair agreement with its workers,” the senators wrote. “Starbucks must reverse course from its current posture, resolve its existing labor disputes, and bargain a fair contract in good faith with these employees.”
Jeremy Dixon, right, and Starbucks baristas picket outside a Starbucks store during a rally to demand a new union contract in Colorado Springs on Wednesday, Oct. 29, 2025. (Photo by Hyoung Chang/The Denver Post)
Kelly, Starbucks’ chief partner officer, said the company already offers the best overall wage and benefits package in retail. She touted strong benefits that include health care, 100% tuition coverage for a four-year college degree and up to 18 weeks of paid family leave. The union, she wrote, is proposing pay increases of 65% immediately and 77% over three years, along with other proposals that would “significantly affect store operations and customer experience.”
“These aren’t serious, evidence-based proposals,” Kelly wrote.
The union, though, says many workers don’t get enough hours to qualify for benefits. Starting wages for baristas, they say, are $15.25 an hour in a majority of states, though Denver’s minimum wage stands at $18.81, requiring higher rates. Barista positions listed on the company’s website start at $17 per hour in Colorado, while shift supervisor roles begin around $21 per hour.
Baristas in Fort Collins and Colorado Springs last month participated in a national wave of pickets as they demanded a fair contract and prepared to strike.
“No contract, no coffee!” workers and their allies shouted as they rallied outside a Starbucks cafe on South College Avenue in Fort Collins. “Respect our rights or expect our strikes!”
Drivers honked their horns in support, while supporters gave thumbs-down reactions to those frequenting the coffee chain.
Three days later, a dozen people picketed outside a cafe on Carmela Grove in Colorado Springs, chanting in call-and-response choruses.
“I’m proud so many other stores are willing to step up with us,” said Blue Taylor, a shift supervisor and strike captain at the store. The 19-year-old watched as the company, during the store’s unionizing drive, spread misinformation about the consequences of organizing and tried to dissuade workers from supporting the cause. It didn’t work.
Amid wider economic uncertainty, some analysts have said that businesses are at a “no-hire, no fire” standstill. That’s caused many to limit new work to only a few specific roles, if not pause openings entirely. At the same time, sizable layoffs have continued to pile up — raising worker anxieties across sectors.
Some companies have pointed to rising operational costs spanning from President Donald Trump’s barrage of new tariffs and shifts in consumer spending. Others cite corporate restructuring more broadly — or, as seen with big names like Amazon, are redirecting money to artificial intelligence.
Federal employees have encountered additional doses of uncertainty, impacting worker sentiment around the job market overall. Shortly after Trump returned to office at the start of the year, federal jobs were cut by the thousands. And the record 43-day government shutdown also left many to work without paychecks.
The impasse put key economic data on hold, too. In a delayed report released Thursday, the Labor Department said U.S. employers added a surprising 119,000 jobs in September. But unemployment rose to 4.4% — and other troubling details emerged, including revisions showing the economy actually lost 4,000 jobs in August. There’s also growing gender and racial disparities. The National Women’s Law Center notes women only accounted for 21,000 of September’s added jobs — and that Black women over the age of 20, in particular, saw unemployment climb to 7.5% for the month.
The shutdown has left holes in more recent hiring numbers. The government says it won’t release a full jobs report for October.
Here are some of the largest job cuts announced recently:
Verizon
In November, Verizon began laying off more than 13,000 employees. In a staff memo announcing the cuts, CEO Dan Schulman said that the telecommunications giant needed to simplify operations and “reorient” the entire company.
General Motors
General Motors moved to lay off about 1,700 workers across manufacturing sites in Michigan and Ohio in late October, as the auto giant adjusts to slowing demand for electric vehicles. Hundreds of additional employees are reportedly slated for “temporary layoffs” at the start of next year.
Paramount
In long-awaited cuts just months after completing its $8 billion merger with Skydance, Paramount plans to lay off about 2,000 employees — about 10% of its workforce. Paramount initiated roughly 1,000 of those layoffs in late October, according to a source familiar with the matter.
In November, Paramount also announced plans to eliminate 1,600 positions as part of divestitures of Televisión Federal in Argentina and Chilevision in Chile. And the company said another 600 employees had chosen voluntary severance packages as part of a coming push to return to the office full-time.
Amazon
Amazon said last month that it will cut about 14,000 corporate jobs, close to 4% of its workforce, as the online retail giant ramps up spending on AI while trimming costs elsewhere. A letter to employees said most workers would be given 90 days to look for a new position internally.
UPS
United Parcel Service has disclosed about 48,000 job cuts this year as part of turnaround efforts, which arrive amid wider shifts in the company’s shipping outputs. UPS also closed daily operations at 93 leased and owned buildings during the first nine months of this year.
Target
Target in October moved to eliminate about 1,800 corporate positions, or about 8% of its corporate workforce globally. The retailer said the cuts were part of wider streamlining efforts.
Nestlé
In mid-October, Nestlé said it would be cutting 16,000 jobs globally — as part of wider cost cutting aimed at reviving its financial performance amid headwinds like rising commodity costs and U.S. imposed tariffs. The Swiss food giant said the layoffs would take place over the next two years.
Lufthansa Group
In September, Lufthansa Group said it would shed 4,000 jobs by 2030 — pointing to the adoption of artificial intelligence, digitalization and consolidating work among member airlines.
Novo Nordisk
Also in September, Danish pharmaceutical company Novo Nordisk said it would cut 9,000 jobs, about 11% of its workforce. The company — which makes drugs like Ozempic and Wegovy — said the layoffs were part of wider restructuring, as it works to sell more obesity and diabetes medications amid rising competition.
ConocoPhillips
Oil giant ConocoPhillips announced plans in September to lay off up to a quarter of its workforce, as part of broader efforts from the company to cut costs. Between 2,600 and 3,250 workers were expected to be impacted, with most layoffs set to take place before the end of 2025.
Intel
Intel has moved to shed thousands of jobs — with the struggling chipmaker working to revive its business. In July, CEO Lip-Bu Tan said Intel expected to end the year with 75,000 “core” workers, excluding subsidiaries, through layoffs and attrition. That’s down from 99,500 core employees reported the end of last year. The company previously announced a 15% workforce reduction.
Microsoft
In May, Microsoft began laying off about 6,000 workers across its workforce. And just months later, the tech giant said it would be cutting 9,000 positions — marking its biggest round of layoffs seen in more than two years. The company has cited “organizational changes,” but the labor reductions also arrive as the company spends heavily on AI.
Procter & Gamble
In June, Procter & Gamble said it would cut up to 7,000 jobs over the next two years, 6% of the company’s global workforce. The maker of Tide detergent and Pampers diapers said the cuts were part of a wider restructuring — also arriving amid tariff pressures.
WASHINGTON, D.C.: The U.S. Department of Education is starting to break apart its major offices and hand their duties to other agencies — an early sign of how U.S. President Donald Trump might follow through on his campaign promise to shut the department down completely.
Several offices that support the nation’s schools and colleges will be moved to departments such as Labor, Interior, Health and Human Services, and even the State Department. Officials say federal funding for schools and colleges will continue as Congress intended, but they have not said whether current Education Department employees will keep their jobs.
Since taking office, Trump has pushed to get rid of the Education Department, saying it is too influenced by liberal ideas. Department leaders have already been preparing to split up their work among other federal agencies. In July, the Supreme Court allowed major layoffs that cut the department’s staff in half.
Education Secretary Linda McMahon has recently begun publicly arguing that her department should be closed, saying on social media that states and other federal agencies could handle its main tasks — such as giving out grants and answering questions from schools — more effectively.
But questions remain about whether other agencies are prepared to take on these responsibilities. The Education Department manages billions of dollars in federal aid and helps states interpret complicated education laws. Closing it will test whether the administration can make the transition smoothly or whether students who depend heavily on federal support — including those in rural and low-income schools and students with disabilities — will be harmed.
Money Will Still Flow
Although most school funding in the U.S. comes from state and local governments, the Education Department plays a crucial role in sending federal money to schools and colleges. Officials say that money will continue to flow, but often through different agencies. For example:
The Department of Labor will now manage major funding programs, including Title I money for schools serving low-income students. Labor already took over adult education programs in June.
Health and Human Services will handle grants that help parents who are attending college.
The State Department will run foreign-language education programs.
The Interior Department will oversee programs for Native American students.
One of the Education Department’s biggest jobs is managing the US$1.6 trillion federal student loan system. For now, this will not change, though both Trump and McMahon have said another agency might be better suited to run it. Pell Grants and federal student loans will still be issued, and borrowers must continue making payments.
The FAFSA website, which students use to apply for financial aid, will stay open, and the department will continue to help families with the application. The department will also continue to oversee college accreditation, which allows schools to accept federal aid.
For now, the department will continue to handle student disability funding, though McMahon has said it could eventually be transferred to Health and Human Services.
The Education Department also oversees investigations into schools accused of discrimination — including cases involving disability rights, sex discrimination, racial discrimination, and shared ancestry bias. These responsibilities will stay within the department for now, though McMahon has suggested they could be moved to the Department of Justice.
However, after the mass layoffs in March, the Office for Civil Rights has been operating with far fewer staff. The cuts have raised doubts about whether it can reduce its enormous backlog of student and family complaints. Department data shows it has been resolving fewer civil rights cases even as new complaints continue to rise.
The New York Liberty hired Golden State Warriors assistant Chris DeMarco to replace Sandy Brondello as head coach, a person familiar with the situation told The Associated Press on Friday.
The person spoke to the AP on condition of anonymity because no official announcement had been made.
DeMarco has been with the Warriors for 13 years in a variety of positions, including player development coach and assistant.
ESPN was first to report the hiring.
He’s the latest WNBA hire with NBA backgrounds, joining Alex Sarama (Portland) and Sonia Raman (Seattle), who were two of the five head coaches hired this offseason in the league.
The Liberty let Brondello go soon after their loss in the first round of the WNBA playoffs. She helped guide the team to its first WNBA championship in 2024. She was recently hired by the Toronto expansion team.
At the time of Brondello’s departure, New York general manager Jonathan Kolb said the team was looking for “evolution and innovation” and asking, “How do we position ourselves to be at the top of the league in a real sustainable way as the league evolves?”
DeMarco has been the Bahamian national team coach since 2019. Liberty star Jonquel Jones hails from that island nation. He has been a part of all four of the Warriors championships.
Copyright 2025 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.
NEW YORK (AP) — Verizon is laying off more than 13,000 employees in mass job reductions that arrive as the telecommunications giant says it must “reorient” its entire company.
The job cuts began on Thursday, per to a staff memo from Verizon CEO Dan Schulman. In the letter, which was seen by The Associated Press, Schulman said Verizon’s current cost structure “limits” the company’s ability to invest — pointing particularly to customer experiences.
“We must reorient our entire company around delivering for and delighting our customers,” Schulman wrote. He added that the company needed to simplify its operations “to address the complexity and friction that slow us down and frustrate our customers.”
Verizon had nearly 100,000 full-time employees as of the end of last year, according to securities filings. A spokesperson confirmed that the layoffs announced Thursday account for about 20% of the company’s management workforce, which isn’t unionized.
Verizon has faced rising competition in both the wireless phone and home internet space — particularly from AT&T, T-Mobile and other big market players. New leadership at the company has stressed the need to right the company’s direction.
Schulman became CEO just last month. In the company’s most recent earnings, he stated that Verizon’s trajectory was at a “critical inflection point” — and said, rather than incremental changes, Verizon would “aggressively transform” its operations.
For its third quarter of 2025, Verizon posted earnings of $4.95 billion and $33.82 billion in revenue. The carrier reported continued subscriber growth for its prepaid wireless services, but it lost a net 7,000 postpaid connections.
News of coming layoffs at Verizon was reported last week by The Wall Street Journal. The outlet says that the 13,000 job cuts mark the largest-ever round of layoffs at the company.
Beyond the cuts across Verizon’s workforce, Schulman said that the New York company would also “significantly reduce” its outsourced and other outside labor expenses.
It’s a tough time for the job market overall — and Verizon isn’t the only company to announce sizeable workforce reductions recently. More and more layoffs have piled up at companies like Amazon, UPS, Nestlé and more.
Some companies have pointed to rising operational costs spanning from U.S. President Donald Trump’s barrage of new tariffs and shifts in consumer spending. Others cite corporate restructuring more broadly — or are redirecting money to artificial intelligence. Regardless, such cuts have raised worker anxieties across sectors.
Schulman on Thursday recognized that “changes in technology and in the economy are impacting the workforce across all industries.” He said that Verizon had established a $20 million “Reskilling and Career Transition Fund” for workers departing the company.
Shares of Verizon fell just over 1% by Thursday’s close.
Sales of previously occupied U.S. homes increased last month to the fastest pace since February as lower mortgage rates helped pull more homebuyers into the market.
Existing home sales rose 1.2% in October from the previous month to a seasonally adjusted annual rate of 4.10 million units, the National Association of Realtors said Thursday.
Sales climbed 1.7% compared with October last year. The latest sales figure topped the roughly 4.09 million pace economists were expecting, according to FactSet.
The national median sales price increased 2.1% in October from a year earlier to $415,200, an all-time high for any October on data going back to 1999. Home prices have risen on an annual basis for 28 months in a row.
Sales have remained sluggish this year, but have gotten a boost this fall as the average rate on a 30-year mortgage declined to its lowest level in more than a year.
Even so, affordability and uncertainty over the economy and job market remain significant hurdles for many aspiring homeowners after years of skyrocketing home prices.
That’s kept existing U.S. home sales stuck at around a 4-million annual pace going back to 2023. Historically, sales have typically hovered around 5.2 million a year.
To close that gap will take a drastic increase in the number of homes on the market and a more meaningful decline in mortgage rates, said Lawrence Yun, NAR’s chief economist, whose 2026 forecast calls for a 14% increase in home sales.
“I don’t think we will get there next year,” Yun said. “We need 1 million more home sales to get us back to normal. I’m only looking at an additional half-million home sales next year.”
Homes purchased last month likely went under contract in August and September, when the average rate on a 30-year mortgage ranged from 6.63% to 6.26%, according to Freddie Mac. The decline in mortgage rates accelerated in October, pulling the average rate down to 6.17% — its lowest level since Oct. 3, 2024. It has ticked higher in the weeks since then.
Home shoppers who can afford to buy at current mortgage rates are benefiting from a wider selection of properties on the market this year than a year ago.
There were 1.52 million unsold homes at the end of last month, down 0.7% from September and up 10.9% from October last year, NAR said. However, the latest inventory snapshot remains well below the roughly 2 million homes for sale that was typical before the COVID-19 pandemic.
“To the degree pre-Covid conditions were more normal, we are still tight on inventory,” said Yun.
Copyright 2025 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.
NEW YORK — U.S. stock index futures added to their gains after the government reported that employers added twice as many jobs as expected in September. Futures were already higher on enthusiasm for a strong earnings report from AI bellwether Nvidia. Futures for the S&P 500 were up 1.5% before the opening bell, while futures for the Dow Jones Industrial Average gained 0.8%. Futures for the Nasdaq shot 1.9% higher. The Labor Department said employapners added 119,000 jobs in September, more than double the 50,000 economists had forecast. The market also focused on Nvidia as Wall Street’s most influential company jumped 5.1% overnight after reporting better-than-expected results.
THIS IS A BREAKING NEWS UPDATE. AP’s earlier story follows below.
Wall Street surged on Thursday after Nvidia reported stronger than expected quarterly earnings, tempering worries that AI-related stocks may have become overvalued.
Futures for the S&P 500 were up 1.1% before the opening bell, while futures for the Dow Jones Industrial Average gained 0.5%. Futures for the Nasdaq shot 1.6% higher.
The market’s focus remained on Nvidia as Wall Street’s most influential stock jumped 5.1% overnight after the chipmaker reported third-quarter earnings of $31.9 billion. That’s a 65% increase over last year and more than analysts were expecting.
The Santa Clara, California company also forecast revenue for the current quarter covering November-January will come in at about $65 billion, nearly $3 billion above analysts’ projections, an indication that demand for its AI chips remains feverish.
Nvidia is the most valuable company by market capitalization on Wall Street, having briefly topped $5 trillion in value. That means its movements have more of an effect on the S&P 500 than any other stock, and it can single-handedly steer the index’s direction some days.
By continuing to deliver big profits for investors, Nvidia has mostly quieted recent criticism that its shares shot too high, too fast.
Nvidia has become a bellwether for the broader frenzy around artificial-intelligence technology, because other companies are using its chips to ramp up their AI efforts.
Walmart also reported its latest quarterly results Thursday. The Arkansas retailer delivered another standout quarter, posting strong sales and profits that blew past Wall Street expectations as it continues to lure cash-strapped Americans who have grown increasingly anxious about the economy and prices.
With other retailers dialing back projections, the nation’s largest retailer raised its financial outlook Thursday after its strong third quarter, setting itself up for a strong holiday shopping season.
Traders also made their final moves ahead of a September jobs report coming from the U.S. government on Thursday. The labor market data, usually released during the first week of every month, was delayed due to the six-week federal government shutdown.
The Labor Department said Wednesday that it will not be releasing a full jobs report for October because the 43-day shutdown meant it couldn’t calculate the unemployment rate and some other key numbers.
The job market has been slowing enough this year that the Fed has already cut its main interest rate twice. Lower rates can give a boost to the economy and to prices for investments, and the expectation on Wall Street had been for more cuts, including at the Fed’s next meeting in December.
At midday in Europe, Germany’s DAX rose 0.8%, while Britain’s FTSE 100 and the CAC 40 in Paris each added 0.6%.
In Asia, Japan’s Nikkei 225 index initially surged as much as 4.2% before giving up some early gains. It closed nearly 2.7% higher at 49,823.94 as technology stocks rallied, with investor sentiment boosted by Nvidia’s strong quarterly results after trading closed in the U.S.
South Korea’s Kospi added 1.9% to 4,004.85, with gains led by technology and energy stocks. Investors were encouraged by Nvidia’s earnings and reports that the U.S. may delay planned semiconductor tariffs.
Samsung Electronics gained 4.2%, while SK Hynix added 1.6%.
Chinese markets ended mixed as reports said the government might be planning more measures to try to revive the ailing property sector.
Hong Kong’s Hang Seng Index was barely changed at 25,835.57, while the Shanghai Composite index lost 0.4% to 3,931.05 after China’s central bank kept its one- and five-year loan prime rates unchanged at 3% and 3.5%, respectively.
Australia’s S&P/ASX 200 gained 1.2% to 8,552.70, also led by gains for technology stocks.
In energy markets, benchmark U.S. crude oil gained 59 cents, or 1%, to $59.61 per barrel. Brent crude, the international standard, rose 62 cents to $64.13 per barrel.
The U.S. dollar climbed to 157.66 Japanese yen from 157.06 yen. It has been trading at nearly the highest level this year on expectations that the government will delay efforts to rein in Japan’s national debt as Prime Minister Sanae Takaichi raises spending to help spur the economy.
WASHINGTON — U.S. employers added a surprisingly solid 119,000 jobs in September, the government said, issuing a key economic report that had been delayed for seven weeks by the federal government shutdown.
The unemployment rate rose to 4.4% in September, highest since October 2021 and up from 4.3% in August, the Labor Department said Thursday. The unemployment rate rose partly because 470,000 people entered the labor market — either working or looking for work — in September and not all of them found jobs right away.
The increase in payrolls was more than double the 50,000 economists had forecast. But Labor Department revisions showed that the economy lost 4,000 jobs in August instead of gaining 22,000 as originally reported. Altogether, revisions shaved 33,000 jobs off July and August payrolls.
Healthcare and social assistance firms added more than 57,000 jobs in September, construction companies 19,000 and retailers almost 14,000. But factories shed 6,000 jobs and the federal government lost 3,000.
Average hourly wages rose just 0.2% from August and 3.8% from a year earlier, edging closer to the 3.5% year-over-year increase that the Federal Reserve’s inflation fighters like to see.
During the 43-day U.S. government shutdown, investors, businesses, policymakers and the Federal Reserve were groping in the dark for clues about the health of the American job market because federal workers had been furloughed and couldn’t collect the data.
The report comes at a time of considerable uncertainty about the economy. The job market has been strained by the lingering effects of high interest rates and uncertainty around Trump’s erratic campaign to slap taxes on imports from almost every country on earth. But economic growth at midyear was resilient.
Fed policymakers are divided over whether to cut interest rates for the third time this year when they meet next month.
Economists expected to see a continuation of what was happening in the spring and summer: weak hiring but few layoffs, an awkward pairing that means Americans who have work mostly enjoy job security – but those who don’t often struggle to find employment.
The job market has been strained this year by the lingering effects of high interest rates engineered to fight a 2021-2022 spike in inflation and uncertainty around Trump’s campaign to slap taxes on imports from almost every country on earth and on specific products — from copper to foreign films.
Labor Department revisions in September showed that the economy created 911,000 fewer jobs than originally reported in the year that ended in March. That meant that employers added an average of just 71,000 new jobs a month over that period, not the 147,000 first reported.
Since March, job creation has slowed even more — to an average 53,000 a month. During the 2021-2023 hiring boom that followed COVID-19 lockdowns, by contrast, the economy was creating 400,000 jobs a month.
President Donald Trump’s crackdown on illegal immigration is expected to reduce the number of people looking for work, which means that the economy can create fewer jobs without sending the unemployment rate higher.
With September numbers out, businesses, investors, policymakers and the Fed will have to wait awhile to get another good look at the numbers behind the American labor market.
The Labor Department said Wednesday that it won’t won’t release a full jobs report for October because it couldn’t calculate the unemployment rate during the government shutdown.
Instead, it will release some of the October jobs data — including the number of jobs that employers created last month — along with the full November jobs report on Dec. 16, a couple of weeks late.
That puts an even more intense focus on September jobs numbers released Thursday. They are the last full measurement of hiring and unemployment that Fed policymakers will see before they meet Dec. 9-10 to decide whether to cut their benchmark interest rate for the third time this year.
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AP Economics Writer Christopher Rugaber contributed to this report.
NEW YORK (AP) — Verizon is laying off more than 13,000 employees, as the telecommunications giant says it must “reorient” its entire company.
The jobs cuts began on Thursday, per to a staff memo from Verizon CEO Dan Schulman. In the letter, which was seen by The Associated Press, Schulman noted that Verizon’s current cost structure limits the company’s ability to invest — pointing particularly to customer experiences.
“We must reorient our entire company around delivering for and delighting our customers,” Schulman wrote. He added that the company needed to simplify its operations “to address the complexity and friction that slow us down and frustrate our customers.”
Beyond the job cuts across Verizon’s workforce, Schulman said that the New York company would also “significantly reduce” its outsourced and other outside labor expenses.
Copyright 2025 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.
WASHINGTON (AP) — The Labor Department said Wednesday that it will not be releasing a full jobs report for October because the 43-day federal government shutdown meant it couldn’t calculate the unemployment rate and some other key numbers.
Instead, it will release some of the October jobs data — most importantly the number of jobs that employers created last month — along with the full November jobs report, now due a couple of weeks late on Dec. 16.
The department’s “employment situation” report usually comes out the first Friday of the month.
But the government shutdown disrupted data collection and delayed the release of the reports. For example, the September jobs report, now coming out Thursday, was originally due Oct. 3.
WASHINGTON (AP) — What was once seen as a near-certain cut in interest rates next month now looks more like a coin flip as Federal Reserve officials sharply disagree over the economy’s health and whether stubborn inflation or weak hiring represent a bigger threat.
The turmoil on the Fed’s 19-member interest-rate setting committee reflects a deeply uncertain economic outlook brought about by multiple factors, including tariffs, artificial intelligence, and changes in immigration and tax policies.
“It’s reflective of a ton of uncertainty,” said Luke Tilley, chief economist at M&T Bank. “It’s not surprising at all that there’s a wide divergence of opinions.”
Fewer rate cuts by the Fed could leave borrowing costs for homes and cars elevated. More expensive mortgages and auto loans contribute to the widespread view, according to polls, that the cost of living is too high.
Some Fed watchers say that an unusually high number of dissents are possible at the December 9-10 meeting, regardless of whether the central bank reduces rates or not. Krishna Guha, an analyst at Evercore ISI, said a decision to cut could lead to as many as four or five dissents, while a decision to keep rates unchanged could produce three.
Four dissenting votes would be highly unusual, given the Fed’s history of seeking consensus. The last time four officials dissented was in 1992, under then-Chair Alan Greenspan.
Fed governor Christopher Waller on Monday noted that critics of the Fed often accuse it of “group think,” since many of its decisions are made unanimously.
“People who are accusing us of this, get ready,” Waller said Monday in remarks in London. “You might see the least group think you’ve seen … in a long time.”
The differences have been exacerbated by the government shutdown’s interruption of economic data, a particular challenge for a Fed that Chair Jerome Powell has often described as “data dependent.” The government’s last jobs report was for August, and inflation for September.
September jobs data will finally be published Thursday, and are expected to show a small gain of 50,000 jobs that month and an unchanged unemployment rate at a still-low 4.3%.
For now, Wall Street investors put the odds of a December rate cut at 50-50, according to CME Fedwatch, down sharply from nearly 94% a month ago. The decline has contributed to the stock market’s drops this week.
After cutting their key rate in September for the first time this year, Fed policymakers signaled they expected to cut twice more, in October and December.
But after implementing a second reduction Oct. 29, Powell poured cold water on the prospects of another cut, describing it as “not a foregone conclusion — far from it.”
And speeches last week by a raft of regional Fed officials pushed the market odds of a December cut even lower. Susan Collins, president of the Federal Reserve Bank of Boston, said, “in all of my conversations with contacts across New England, I hear concerns about elevated prices.”
Collins said that keeping the Fed’s key rate at its current level of about 3.9% would help bring inflation down. The economy “has been holding up quite well” even with interest rates where they are, she added.
Several other regional presidents voiced similar concerns, including Raphael Bostic of the Atlanta Fed, Alberto Musalem of the St. Louis Fed, and Jeffrey Schmid at the Kansas City Fed. Musalem, Collins, and Schmid are among the 12 officials who vote on policy this year. Schmid dissented in October in favor of keeping rates unchanged.
“When I talk to contacts in my district, I hear continued concern over the pace of price increases,” Schmid said Friday. “Some of this has to do with the effect of tariffs on input prices, but it is not just tariffs — or even primarily tariffs — that has people worried. I hear concerns about rising health care costs and insurance premiums, and I hear a lot about electricity.”
On Monday, however, Waller argued that sluggish hiring is a bigger concern, and renewed his call for a rate cut next month.
“The labor market is still weak and near stall speed,” he said. “Inflation through September continued to show relatively small effects from tariffs and support the hypothesis that tariffs … are not a persistent source of inflation.”
Waller also dismissed the concern — voiced by Schmid and others — that the Fed should keep rates elevated because inflation has topped the Fed’s 2% target for five years. So far that hasn’t led the public to worry that inflation will stay elevated for an extended period, Waller noted.
“You can’t just sort of say it’s been above target for five years, so I’m not going to cut,” he added. “You got to give us better answers than that.”
There could be consensus for an interest rate cut if, say, new data for October and November show the economy shedding jobs, according to Esther George, the former president of the Kansas City Fed.
It’s also worth noting that many economists had expected multiple dissents in September, but instead only Stephen Miran, a governor appointed that month by President Donald Trump, voted against the rate cut decision, in favor of an even bigger reduction.
“Registering a dissent is a hard decision, and I think you’re going to find people that are speaking today that wouldn’t follow through with a vote in that direction,” she said. “I think you’re going to find enough consensus, whichever way they go.”
WASHINGTON — The Trump administration on Tuesday accelerated the dismantling of the U.S. Department of Education with a plan to transfer key, legally required functions to other agencies, including oversight of its $18-billion, core anti-poverty program, Title 1.
Critics said the move was politicized and counterproductive and fear future program cuts. California Supt. of Public Instruction Tony Thurmond said vital services to the state and nation’s most vulnerable students were likely to be disrupted.
The steps move toward fulfilling a Trump campaign promise to eliminate the department, which some conservatives have long derided as wasteful, ineffective and unnecessary.
“The Trump Administration is taking bold action to break up the federal education bureaucracy and return education to the states,” U.S. Secretary of Education Linda McMahon said in a statement. “Cutting through layers of red tape in Washington is one essential piece of our final mission.”
President Trump called for the department’s elimination in a March executive order. Both he and McMahon have spoken of a broad goal of sparking innovation through local control.
Even before this effort, states provided about 90% of their own funding for education, but federal investment is still crucial, advocates say. In particular, the federal role has focused on ensuring services are provided for overlooked students and students with higher needs, such as those facing discrimination and poverty, and students with disabilities.
While slashing the Education Department workforce, which Trump officials have characterized as a bloated bureaucracy, the president has adopted an interventionist agenda in education as well. He has threatened pulling federal funding if states and schools don’t follow his directives to combat antisemitism, clamp down on campus protests, end diversity, equity and inclusion programs and oppose expanded rights for transsexual students, among other issues in keeping with his agenda.
The strategy behind the moves
The key strategy announced Tuesday creates partnerships with other federal agencies, which will take on Education Department responsibilities. The department would retain legal authority even as the actual work shifts elsewhere.
These partnerships are meant to sidestep federal rules — under the jurisdiction of Congress — that place programs, including Title I, specifically within the Education Department.
Title I is expected to shift to the Department of Labor, which is likely to absorb an unknown number of education workers with the necessary experience and expertise. The long-term goal is to win buy-in from Congress — and then to eliminate the Education Department entirely, which requires congressional approval.
“As we partner with these agencies to improve federal programs, we will continue to gather best practices in each state,” McMahon said.
She also spoke of working “with Congress to codify these reforms,” an acknowledgment that the Department of Education was created by an act of Congress.
Administration officials insist that their actions to date are legal, citing as precedent earlier agreements between federal agencies, including one example from the Biden administration. The scale of the current effort, however, is a much larger order of magnitude.
Rep. Jimmy Gomez (D-Los Angeles) questioned Trump’s authority to take this action. “Not only is dismantling the education department without congressional approval illegal, but they chose today because they knew the Epstein vote would dominate the headlines. They clearly didn’t want the public to see what they were doing to our kids’ futures.”
Becky Pringle, president of the National Education Assn., the nation’s largest teachers union, accused the administration of “taking every chance it can to hack away at the very protections and services our students need.”
How the action affects vulnerable students
The changes will complicate efforts to get money and services where they are needed, Thurmond said.
“This is an unnecessary, disruptive change that is going to harm students, especially the most vulnerable,” Thurmond said. “It is clearly less efficient for state departments of education and local school districts to work with four different federal agencies instead of one.
“Experience also tells us that any time you move expertise and responsibilities, you disrupt services. There is no way to avoid negative impacts on our children and our classrooms with a change of this magnitude.”
But administration officials talked of new efficiencies and synergies, asserting that associating education with workforce development in the Department of Labor would make education more relevant to a student’s employment future.
What happens to other programs?
The Labor Department would oversee almost all grant programs that are now managed by the Education Department’s offices for K-12 and higher education. That includes funding pools for teacher training, English instruction and TRIO, a program that helps steer low-income students to college degrees.
Tuesday’s action leaves in place the Education Department’s $1.6-trillion student loan portfolio and its funding for students with disabilities.
But ultimately moving these programs seems likely if the mission remains to shutter the department.
Another transfer puts Health and Human Services in charge of a grant program for parents who are attending college, along with management of foreign medical school accreditation. The State Department will take on foreign language programs. Interior will oversee programs for Native American education.
Federal officials said states and schools should see no funding disruptions. Liz Huston, White House assistant press secretary, said Tuesday the administration “is fully committed to doing what’s best for American students, which is why it’s critical to shrink this bloated federal education bureaucracy while still ensuring efficient delivery of funds and essential programs.”
The Education Department tested this approach in June, announcing the transfer of adult education programs to the Labor Department. Working out essential details took some five months, officials said Tuesday.
The administration’s plan immediately drew support from Tim Walberg, a Republican who represents a southern Michigan district.
“The past few decades have made one thing clear: The status quo is broken,” Walberg said. “As the bureaucracy swelled, left-wing bureaucrats were emboldened to waste taxpayer dollars on a radical agenda. As a result, our students have been left in the dust. Test scores are plummeting, students can’t read, and college graduates leave school burdened by debt rather than equipped with workforce-ready skills.”
But the Education Department — and its central programs — has bipartisan support.
One Republican expressing concern is Pennsylvania Rep. Brian Fitzpatrick.
“The United States Congress created the U.S. Department of Education for very good reason,” Fitzpatrick said. “And for millions of families, particularly those raising children with disabilities or living in low-income communities, the Department’s core offices are not discretionary functions. They are foundational. They safeguard civil rights, expand opportunity, and ensure that every child, in every community, has the chance to learn, grow, and succeed on equal footing.”
Feds say programs’ funding will continue
Department officials said programs will continue to be funded at levels set by Congress. But that doesn’t stop programs from running afoul of another portion of the Trump agenda. For example, the Tuesday announcement notes that a program to help with the education of the children of migrant workers will transfer to the Labor Department.
However, on other fronts the Trump administration is trying to eliminate that program. The administration first tried to hold back funding approved by Congress. The administration relented under pressure. But the administration also cut funding for migrant education from its budget proposal for future years.
Officials said they did not yet have details on whether the changes would bring further job cuts at the Education Department, which has been thinned by waves of layoffs and retirements under pressure.
Blume is a Times staff writer. Binkley writes for the Associated Press. Times staff writers Daniel Miller and Michael Wilner contributed to this report.
More than 1,000 unionized Starbucks workers went on strike at 65 U.S. stores Thursday to protest a lack of progress in labor negotiations with the company.
The strike was intended to disrupt Starbucks’ Red Cup Day, which is typically one of the company’s busiest days of the year. Since 2018, Starbucks has given out free, reusable cups on that day to customers who buy a holiday drink. Starbucks Workers United, the union organizing baristas, said Thursday morning that the strike had already closed some stores and was expected to force more to close later in the day.
Starbucks Workers United said stores in 45 cities would be impacted, including New York, Philadelphia, Minneapolis, San Diego, St. Louis, Dallas, Columbus, Ohio, and Starbucks’ home city of Seattle. There is no date set for the strike to end, and more stores are prepared to join if Starbucks doesn’t reach a contract agreement with the union, organizers said.
Starbucks emphasized that the vast majority of its U.S. stores would be open and operating as usual Thursday. The coffee giant has 10,000 company-owned stores in the U.S., as well as 7,000 licensed locations in places like grocery stores and airports.
As of noon Thursday on the East Coast, Starbucks said it was on track to meet or exceed its sales expectations for the day at its company-owned stores.
“The day is off to an incredible start,” the company said in a statement.
Around 550 company-owned U.S. Starbucks stores are currently unionized. More have voted to unionize, but Starbucks closed 59 unionized stores in September as part of a larger reorganization campaign.
Here’s what’s behind the strike.
A stalled contract agreement
Striking workers say they’re protesting because Starbucks has yet to reach a contract agreement with the union. Starbucks workers first voted to unionize at a store in Buffalo in 2021. In December 2023, Starbucks vowed to finalize an agreement by the end of 2024. But in August of last year, the company ousted Laxman Narasimhan, the CEO who made that promise. The union said progress has stalled under Brian Niccol, the company’s current chairman and CEO. The two sides haven’t been at the bargaining table since April.
Workers want higher pay, better hours
Workers say they’re seeking better hours and improved staffing in stores, where they say long customer wait times are routine. They also want higher pay, pointing out that executives like Niccol are making millions and the company spent $81 million in June on a conference in Las Vegas for 14,000 store managers and regional leaders.
Dochi Spoltore, a barista from Pittsburgh, said in a union conference call Thursday that it’s hard for workers to be assigned more than 19 hours per week, which leaves them short of the 20 hours they would need to be eligible for Starbucks’ benefits. Spoltore said she makes $16 per hour.
“I want Starbucks to succeed. My livelihood depends on it,” Spoltore said. “We’re proud of our work, but we’re tired of being treated like we’re disposable.”
The union also wants the company to resolve hundreds of unfair labor practice charges filed by workers, who say the company has fired baristas in retaliation for unionizing and has failed to bargain over changes in policy that workers must enforce, like its decision earlier this year to limit restroom use to paying customers.
Starbucks stands by its wages and benefits
Starbucks says it offers the best wage and benefit package in retail, worth an average of $30 per hour. Among the company’s benefits are up to 18 weeks of paid family leave and 100% tuition coverage for a four-year college degree. In a letter to employees last week, Starbucks’ Chief Partner Officer Sara Kelly said the union walked away from the bargaining table in the spring.
Kelly said some of the union’s proposals would significantly alter Starbucks’ operations, such as giving workers the ability to shut down mobile ordering if a store has more than five orders in the queue.
Kelly said Starbucks remained ready to talk and “believes we can move quickly to a reasonable deal.” Kelly also said surveys showed that most employees like working for the company, and its barista turnover rates are half the industry average.
Limited locations with high visibility
Unionized workers have gone on strike at Starbucks before. In 2022 and 2023, workers walked off the job on Red Cup Day. Last year, a five-day strike ahead of Christmas closed 59 U.S. stores. Each time, Starbucks said the disruption to its operations was minimal. Starbucks Workers United said the new strike is open-ended and could spread to many more unionized locations.
The number of non-union Starbucks locations dwarfs the number of unionized ones. But Todd Vachon, a union expert at the Rutgers School of Management and Labor Relations, said any strike could be highly visible and educate the public on baristas’ concerns.
Unlike manufacturers, Vachon said, retail industries depend on the connection between their employees and their customers. That makes shaming a potentially powerful weapon in the union’s arsenal, he said.
Improving sales
Starbucks’ same-store sales, or sales at locations open at least a year, rose 1% in the July-September period. It was the first time in nearly two years that the company had posted an increase. In his first year at the company, Niccol set new hospitality standards, redesigned stores to be cozier and more welcoming, and adjusted staffing levels to better handle peak hours.
Starbucks also is trying to prioritize in-store orders over mobile ones. Last week, the company’s holiday drink rollout in the U.S. was so successful that it almost immediately sold out of its glass Bearista cup. Starbucks said demand for the cup exceeded its expectations, but it wouldn’t say if the Bearista will return before the holidays are over.
NEW YORK (AP) — As workers face frozen salaries, inflation and fear of layoffs, some have decided to branch out from their traditional careers. They’re taking on side jobs to bring in additional income and provide a backup plan should they find themselves out of work, or adding second, third and sometimes fourth jobs — what some call “polyworking” — to the mix.
Take Katelyn Cusick, 29. She beautifies displays as a visual merchandiser for Patagonia at her full-time job. Then she works a side gig managing social media influencers for a German shoe brand for 10 to 15 hours per week. She also has an Etsy shop where she sells paintings. If that wasn’t enough, she ushers at concerts in the San Francisco Bay Area — a way to see live shows for free.
“Every day is different and every day feels like a new day,” Cusick said. “That is ultimately why I started doing all these side hustles, just because I wanted to switch it up. I don’t want to just do the same thing every day.”
Some are drawn to side jobs because of instability in their workplace, or the perception that they may lose their income. Still others, reluctant to trust one employer to provide a steady job that lasts, are supplementing their main roles with gig work on apps such as Uber and Grubhub.
This article is part of AP’s Be Well coverage, focusing on wellness, fitness, diet and mental health. Read more Be Well.
“We have seen stagnant salaries, we’ve seen inflation, we’ve seen the cost of living overall increasing, even beyond our inflation measures,” said Alexandrea Ravenelle, sociologist and gig economy researcher at University of North Carolina at Chapel Hill. “So people are looking for ways to supplement and to build themselves a little bit of a safety net.”
Some are creating “portfolio careers” where they work a variety of jobs, each building different valuable skills. In Cusick’s case, side work keeps her social media marketing skills current.
“Rather than having one job that you can have for many, many years and thinking about your career progression as a linear pathway, some people are putting together multiple side hustles based on their skills and interests and making the money work by having multiple revenue streams,” said Elaine Chen, director of the Derby Entrepreneurship Center at Tufts University.
Career experts and those with side jobs share tips on how to get started and what to avoid if you’re considering branching out from your 9-to-5.
Follow a passion
If you’re embarking on a side business on top of a full-time job, consider picking something you’re naturally interested in, since you’ll spend a lot of free time on the venture.
“You have to love it,” Chen said. “Usually it is something that the person is really passionate about.”
For Josie White, 31, that passion was mental health. After struggling with schizoaffective disorder and finding effective treatment, she wanted to help others who have mental health challenges feel less alone.
While working full-time as a fundraiser for Shelter the Homeless, a nonprofit organization in Salt Lake City, White decided to pursue public speaking on the side and began looking for opportunities to address groups and conferences where she could share her own experiences with mental illness “to reassure people that there is hope and a light at the end of the tunnel.”
Be realistic about money
Launching a side hustle may require initial investment, and it can take a considerable amount of time before it generates income.
When White started her side business, she began by offering her speaking services as an unpaid volunteer. She landed some gigs training nonprofit staff and speaking about fundraising, which wasn’t her original goal, but those opportunities helped her gain experience.
Over the past year she’s booked 10 speaking engagements, and four of those will be paid, she said. She’s taken the money she earned so far and re-invested it into developing her public speaking skills.
“The goal is ultimately to get paid, but right now I’m putting in the legwork to reach that,” White said. “It’s starting to snowball.”
Know the risks of gig work
Some side jobs, such as gig work delivering groceries or driving passengers, may generate income right away.
Tom Ritter of Syracuse, New York, was supplementing his income as a workforce management specialist at a nonprofit by making deliveries for Instacart and Spark, Walmart’s delivery platform, on top of his full-time job. The side work helped him pay his bills, especially when he recently lost his day job.
“For me, even that extra couple hundred dollars a month went a long way, and it still does,” Ritter, 39, said.
Ravenelle cautioned against relying too heavily on gig work for income. It can be hard to transition back to full-time, permanent jobs, where workers typically wait two weeks or more for a first paycheck, and gig work carries a stigma among some employers, she said.
Plus, if gig workers are earning good wages, the platforms will typically change the algorithms so they earn less money, Ravenelle said. “The house always wins when it comes to the gig platforms,” she said.
Be skeptical
Once people are looking for side jobs, they should be cautious if an opportunity found online seems too good to be true. Some online influencers promote business ideas that are more akin to scams.
In Ravanelle’s research she’s spoken with people who saw online videos about making money selling microgreens.
“They thought they could make thousands of dollars a month, working from home, growing microgreens in their kitchen, and then selling them to high-end restaurants,” Ravenelle said. “No. The person who sells you the grow lights and gives you the classes is the person who’s making the money.”
Finding the time
Starting a second job or career can dig into personal time, reducing opportunities to exercise or be with family and friends.
White works Monday through Thursday at Shelter the Homeless, clocking 40 to 45 hours per week. With Fridays off, she spends that day practicing speaking skills or generating new business.
“I wouldn’t describe my life as balanced,” she said. “But am I enjoying it? Yes. And I think that matters.”
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WASHINGTON — The Labor Department will release its numbers on September hiring and unemployment next Thursday, a month and a half late, marking the beginning of the end of a data drought caused by the 43-day federal government shutdown.
The statistical blackout meant that the Federal Reserve, businesses, policymakers and investors have largely been in the dark about inflation, job creation, GDP growth and other measures of the U.S. economic health since late summer.
Thomas Simons and Michael Bacolas at Jefferies, a financial firm, wrote in a commentary Friday that over 30 reports from the Labor Department’s Bureau of Labor Statistics and the Commerce Department’s Bureau of Economic Analysis and Census Bureau were delayed by the political standoff.
The Labor Department did not release its weekly report on the number of Americans signing up for unemployment benefits for seven straight weeks. That jobless claims report is seen as a potential early indicator of where the labor market is headed.
The Labor Department did release its consumer price index for September — the most popular measurement of inflation — nine days late on Oct. 24. The government made an exception for that report because of its urgency: It is used to calculate the annual cost of living adjustment for tens of millions of Americans receiving Social Security and other federal benefits.
The interruption of federal economic statistics came at an awkward time. President Donald Trump’s policies — sweeping, ever-changing import taxes and massive deportations of people working in the United States illegally — are creating uncertainty about the economic outlook.
And the economy has sent conflicting signals: Economic growth looked solid at midyear and unemployment has been low. But job growth has lost momentum, and inflation has remained stubbornly above the Federal Reserve’s 2% target, partly because of the impact of Trump’s tariffs.
Jefferies’ Simons expects the September employment report to show that employers added 65,000 jobs that month — unimpressive, but up from a meager 22,000 in August. He figures that unemployment remained at a low 4.3%.
The data cutoff has caused consternation on Wall Street and deepened divisions among Fed officials over whether to cut interest rates for a third straight time at their next meeting in December.
This week, some Fed policymakers have suggested that a lack of data is one reason they may support holding off on another rate cut.
As a result, fresh reports on jobs and inflation in the coming weeks and months will carry huge weight at the Fed because new numbers could help resolve disagreements between those who support another interest rate reduction and those who are opposed.
Even with the government reopened, however, it could take a few more weeks for the data to fully recover. Earlier this week, Kevin Hassett, a top White House economist, said only a part of October’s jobs report — originally scheduled to be released Nov. 7 — will eventually be released.
The Bureau of Labor Statistics will likely have enough data from businesses to calculate how many jobs were gained or lost last month. Much of that is submitted electronically. But a separate survey of households, which is used to calculate the unemployment rate, didn’t take place during the shutdown.
As a result, for the first time in 77 years, the BLS may not calculate an unemployment rate for the month of October.
Other White House officials have previously said there also won’t be an October inflation report, because the data couldn’t be gathered due to the government shutdown. That will pose a challenge for the Fed, which is seeking to determine whether inflation is headed back to 2%.
The data interruption occurred just a couple of months after Trump fired the director of the BLS, Erika McEntarfer, after it produced employment figures Aug. 1 that he didn’t like. They showed only modest job gains in July and sharply smaller increases in May and June than previously estimated.
Still, economists said the upcoming reports should be free from bias. Currently, there are no political appointees at the agency, after Trump withdrew his nominee to head the BLS Sept. 30.
“The data are being produced by roughly the same set of people as in the past,” Aaron Sojourner, senior economist at the W.E. Upjohn Institute, said.
More than 1,000 unionized Starbucks workers plan to strike at 65 U.S. stores Thursday to protest a lack of progress in labor negotiations with the company.
The strike was intended to disrupt Starbucks’ Red Cup Day, which is typically one of the company’s busiest days of the year. Since 2018, Starbucks has given out free, reusable cups on that day to customers who buy a holiday drink.
Starbucks Workers United, the union organizing Starbucks baristas, said stores in 45 cities would be impacted, including New York, Philadelphia, Minneapolis, San Diego, St. Louis, Dallas, Columbus, Ohio, and Starbucks’ home city of Seattle. There is no date set for the strike to end, and more stores are prepared to join if Starbucks doesn’t reach a contract agreement with the union, organizers said.
Starbucks emphasized that the vast majority of its U.S. stores would be open and operating as usual Thursday. The coffee giant has 10,000 company-owned stores in the U.S., as well as 7,000 licensed locations in places like grocery stores and airports.
Around 550 company-owned U.S. Starbucks stores are currently unionized. More have voted to unionize, but Starbucks closed 59 unionized stores in September as part of a larger reorganization campaign.
Here’s what’s behind the strike.
Striking workers say they’re protesting because Starbucks has yet to reach a contract agreement with the union. Starbucks workers first voted to unionize at a store in Buffalo in 2021. In December 2023, Starbucks vowed to finalize an agreement by the end of 2024. But in August of last year, the company ousted Laxman Narasimhan, the CEO who made that promise. The union said progress has stalled under Brian Niccol, the company’s current chairman and CEO.
Workers say they’re seeking better hours and improved staffing in stores, where they say long customer wait times are routine. They say too many workers aren’t getting the required 20 hours per week they need before Starbucks’ benefits kick in. They also want higher pay, pointing out that executives like Niccol are making millions.
The union also wants the company to resolve hundreds of unfair labor practice charges filed by workers, who say the company has fired baristas in retaliation for unionizing and has failed to bargain over changes in policy that workers must enforce, like its decision earlier this year to limit restroom use to paying customers.
Starbucks says it offers the best wage and benefit package in retail, worth an average of $30 per hour. Among the company’s benefits are up to 18 weeks of paid family leave and 100% tuition coverage for a four-year college degree. In a letter to employees last week, Starbucks’ Chief Partner Officer Sara Kelly said the union walked away from the bargaining table in the spring.
Kelly said Starbucks remained ready to talk and “believes we can move quickly to a reasonable deal.” Kelly also said surveys showed that most employees like working for the company, and its barista turnover rates are half the industry average.
Unionized workers have gone on strike at Starbucks before. In 2022 and 2023, workers walked off the job on Red Cup Day. Last year, a five-day strike ahead of Christmas closed 59 U.S. stores. Each time, Starbucks said the disruption to its operations was minimal. Starbucks United said the new strike is open-ended and could spread to many more unionized locations.
The number of non-union Starbucks locations dwarfs the number of unionized ones. But Todd Vachon, a union expert at the Rutgers School of Management and Labor Relations, said any strike could be highly visible and educate the public on baristas’ concerns.
Unlike manufacturers, Vachon said, retail industries depend on the connection between their employees and their customers. That makes shaming a potentially powerful weapon in the union’s arsenal, he said.
Starbucks’ same-store sales, or sales at locations open at least a year, rose 1% in the July-September period. It was the first time in nearly two years that the company had posted an increase. In his first year at the company, Niccol set new hospitality standards, redesigned stores to be cozier and more welcoming, and adjusted staffing levels to better handle peak hours.
Starbucks also is trying to prioritize in-store orders over mobile ones. Last week, the company’s holiday drink rollout in the U.S. was so successful that it almost immediately sold out of its glass Bearista cup. Starbucks said demand for the cup exceeded its expectations, but it wouldn’t say if the Bearista will return before the holidays are over.
WASHINGTON — Two Federal Reserve officials expressed opposition Wednesday to another interest rate cut at the central bank’s next meeting in December, further muddying the outlook for the Fed’s next steps.
The remarks by Susan Collins, president of the Federal Reserve Bank of Boston, and Raphael Bostic, president of the Atlanta Fed, suggest that the central bank’s rate-setting committee could be tilting against what had been an expected third straight cut next month.
The officials cited several reasons for keeping rates unchanged, after a reduction in September and in October. They argued that inflation is stubbornly elevated and has been above the Fed’s 2% target for nearly five years, while the economy is resilient and doesn’t appear to need more rate cuts. The job market is stumbling, with hiring nearly at a standstill, but layoffs still seem muted, they said.
Another factor has been the government shutdown, which has cut off the economic data the Fed relies on to discern the economy’s path. On Wednesday White House spokeswoman Karoline Leavitt said that the jobs and inflation reports for October would likely never be released.
“Formulating an economic outlook is challenging — and the limited data compounds the difficulty,” Collins said in a speech in Boston.
“It will likely be appropriate to keep policy rates at the current level for some time … in this highly uncertain environment,” she added.
That is a shift from her previous speech in October, when she expressed support for at least one more rate cut.
Earlier Wednesday, Bostic said he remains concerned inflation is too high, and added that, “I … favor keeping the funds rate steady until we see clear evidence that inflation is again moving meaningfully toward its 2% target.” Bostic said earlier Wednesday that he will retire when his current term ends on Feb. 28, 2026.
Their remarks come at an unusually challenging time for the Fed, with the economy facing both weak hiring and elevated inflation. Typically, the Fed would reduce its rate to encourage borrowing, spending and job gains, while it would keep it unchanged — or even raise it — to combat inflation.
The 19 officials on the Fed’s rate-setting committee narrowly supported three rate cuts this year at their September meeting, but Chair Jerome Powell said at a news conference late last month that the committee remains divided and another cut in December was not a “foregone conclusion.”
David Seif, chief economist for developed markets at Nomura Securities, expects the Fed will skip a rate cut in December and won’t reduce borrowing costs again until March.
“There is a large segment of the Fed that is uncomfortable with a December cut,” Seif said.
Collins also said that additional reductions to the Fed’s rate could, by boosting the economy, accelerate inflation.
“Absent evidence of a notable labor market deterioration, I would be hesitant to ease policy further, especially given the limited information on inflation due to the government shutdown,” she said.
Bostic, meanwhile, said the Atlanta Fed’s surveys of businesses show that many companies intend to raise prices next year, a sign that inflation may not cool anytime soon.
“We cannot breezily assume inflationary pressures will quickly dissipate after a one-time bump in prices from new import duties,” Bostic said, referring to President Donald Trump’s tariffs. “Across all our information sources, I see little to no evidence that we should be sanguine about the forward trajectory of inflation.”
Some Fed officials, such as Fed governor Stephen Miran, have argued that the tariffs will only temporarily lift prices and outside those one-time increases, inflation is cooling.
HONG KONG (AP) — Vaishnavi Srinivasagopalan, a skilled Indian IT professional who has worked in both India and the U.S., has been looking for work in China. Beijing’s new K-visa program targeting science and technology workers could turn that dream into a reality.
The K-visa rolled out by Beijing last month is part of China’s widening effort to catch up with the U.S. in the race for global talent and cutting edge technology. It coincides with uncertainties over the U.S.’s H-1B program under tightened immigrations policies implemented by President Donald Trump.
“(The) K-visa for China (is) an equivalent to the H-1B for the U.S.,” said Srinivasagopalan, who is intrigued by China’s working environment and culture after her father worked at a Chinese university a few years back. “It is a good option for people like me to work abroad.”
The K-visa supplements China’s existing visa schemes including the R-visa for foreign professionals, but with loosened requirements, such as not requiring an applicant to have a job offer before applying.
Stricter U.S. policies toward foreign students and scholars under Trump, including the raising of fees for the H-1B visa for foreign skilled workers to $100,000 for new applicants, are leading some non-American professionals and students to consider going elsewhere.
“Students studying in the U.S. hoped for an (H-1B) visa, but currently this is an issue,” said Bikash Kali Das, an Indian masters student of international relations at Sichuan University in China.
China wants more foreign tech professionals
China is striking while the iron is hot.
The ruling Communist Party has made global leadership in advanced technologies a top priority, paying massive government subsidies to support research and development of areas such as artificial intelligence, semiconductors and robotics.
“Beijing perceives the tightening of immigration policies in the U.S. as an opportunity to position itself globally as welcoming foreign talent and investment more broadly,” said Barbara Kelemen, associate director and head of Asia at security intelligence firm Dragonfly.
Unemployment among Chinese graduates remains high, and competition is intense for jobs in scientific and technical fields. But there is a skills gap China’s leadership is eager to fill. For decades, China has been losing top talent to developed countries as many stayed and worked in the U.S. and Europe after they finished studies there.
The brain drain has not fully reversed.
Many Chinese parents still see Western education as advanced and are eager to send their children abroad, said Alfred Wu, an associate professor at the National University of Singapore.
Still, in recent years, a growing number of professionals including AI experts, scientists and engineers have moved to China from the U.S., including Chinese-Americans. Fei Su, a chip architect at Intel, and Ming Zhou, a leading engineer at U.S.-based software firm Altair, were among those who have taken teaching jobs in China this year.
Many skilled workers in India and Southeast Asia have already expressed interest about the K-visa, said Edward Hu, a Shanghai-based immigration director at the consultancy Newland Chase.
Questions about extra competition from foreign workers
With the jobless rate for Chinese aged 16-24 excluding students at nearly 18%, the campaign to attract more foreign professionals is raising questions.
“The current job market is already under fierce competition,” said Zhou Xinying, a 24-year-old postgraduate student in behavioral science at eastern China’s Zhejiang University.
While foreign professionals could help “bring about new technologies” and different international perspectives, Zhou said, “some Chinese young job seekers may feel pressure due to the introduction of the K-visa policy.”
Kyle Huang, a 26-year-old software engineer based in the southern city of Guangzhou, said his peers in the science and technology fields fear the new visa scheme “might threaten local job opportunities”.
A recent commentary published by a state-backed news outlet, the Shanghai Observer, downplayed such concerns, saying that bringing in such foreign professionals will benefit the economy. As China advances in areas such as AI and cutting-edge semiconductors, there is a “gap and mismatch” between qualified jobseekers and the demand for skilled workers, it said.
“The more complex the global environment, the more China will open its arms,” it said.
“Beijing will need to emphasize how select foreign talent can create, not take, local jobs,” said Michael Feller, chief strategist at consultancy Geopolitical Strategy. “But even Washington has shown that this is politically a hard argument to make, despite decades of evidence.”
China’s disadvantages even with the new visas
Recruitment and immigration specialists say foreign workers face various hurdles in China. One is the language barrier. The ruling Communist Party’s internet censorship, known as the “Great Firewall,” is another drawback.
A country of about 1.4 billion, China had only an estimated 711,000 foreign workers residing in the country as of 2023.
The U.S. still leads in research and has the advantage of using English widely. There’s also still a relatively clearer pathway to residency for many, said David Stepat, country director for Singapore at the consultancy Dezan Shira & Associates.
Nikhil Swaminathan, an Indian H1-B visa holder working for a U.S. non-profit organization after finishing graduate school there, is interested in China’s K-visa but skeptical. “I would’ve considered it. China’s a great place to work in tech, if not for the difficult relationship between India and China,” he said.
Given a choice, many jobseekers still are likely to aim for jobs in leading global companies outside China.
“The U.S. is probably more at risk of losing would-be H-1B applicants to other Western economies, including the UK and European Union, than to China,” said Feller at Geopolitical Strategy.
“The U.S. may be sabotaging itself, but it’s doing so from a far more competitive position in terms of its attractiveness to talent,” Feller said. “China will need to do far more than offer convenient visa pathways to attract the best.”
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AP writer Fu Ting in Washington and researchers Yu Bing and Shihuan Chen in Beijing contributed.
