How Project 2025 will hurt private-sector employers

Last week, we introduced the discussion of the Republican Party’s Project 2025, a 900-page blueprint for reshaping the United States into a far more conservative, authoritarian nation. Today, we’re going to examine how many of the proposed changes would harm employers, even though many supporters of the blueprint, such as Vice Presidential candidate JD Vance, are trying to convince them otherwise.

Project 2025 has garnered significant attention for its bold promises to reduce government size, cut regulations, and give more control to the executive branch. While much of the focus has been on the implications for government jobs, the private sector could also face unexpected challenges as a result of these reforms. Despite the plan’s intent to benefit businesses by reducing regulatory burdens, private-sector employers may find themselves struggling with the long-term effects of workforce disruptions, market instability, and reduced consumer confidence.

One of the most immediate impacts of Project 2025 for private-sector employers could be the shrinking of the federal workforce. Federal employees play a critical role in supporting local economies, particularly in areas where government agencies are the dominant employer. As Project 2025 reduces the size of the federal government, regions that rely on government jobs will likely see decreased spending and slower economic growth. For private-sector employers in those areas, this could mean fewer customers and reduced demand for goods and services. Businesses that depend on a stable, consumer-driven market may face slowdowns in sales, which could force layoffs, reduce investments, and hamper growth.

The initiative’s push for deregulation may also create a double-edged sword for businesses. On the surface, fewer regulations could reduce operational costs and allow companies to expand more freely. However, a lack of oversight and weakened regulations could lead to market instability. In industries such as energy, healthcare, and finance, deregulation could lead to sudden shifts in market dynamics, making it harder for businesses to plan long-term strategies. Without clear and consistent guidelines, private-sector employers could find themselves navigating a more chaotic, unpredictable marketplace. Smaller businesses, in particular, may struggle to compete if deregulation primarily benefits larger corporations with more resources.

Additionally, Project 2025’s potential weakening of labor protections may pose challenges for private-sector employers when it comes to attracting and retaining talent. While businesses may initially benefit from looser restrictions on wages, benefits, and working conditions, the long-term effects could harm employer-employee relations. Workers may become more hesitant to join companies that offer fewer protections, leading to higher turnover rates and greater difficulty in recruiting top talent. Younger workers, in particular, are increasingly seeking jobs that offer strong benefits, work-life balance, and stability. If Project 2025 leads to a decline in these offerings, private-sector employers may face a growing talent shortage, putting pressure on them to compete with more progressive companies in other industries or countries that offer better working conditions.

Furthermore, the plan’s emphasis on reducing federal spending and eliminating regulations could negatively impact private companies that rely on government contracts. Industries such as defense, infrastructure, and technology often work closely with federal agencies, and these partnerships are a key source of revenue. As the government scales back its role in various sectors, private-sector businesses that depend on these contracts may find themselves scrambling to replace lost income. For many companies, especially those that provide specialized services or products, finding alternative revenue streams could be difficult, leading to cutbacks and even layoffs.

Finally, Project 2025’s broader political and social ramifications may also impact private-sector employers. The initiative could lead to increased polarization and social unrest, particularly if significant parts of the workforce are laid off or if important public services are cut. This unrest can affect private businesses in many ways, from supply chain disruptions to decreased consumer confidence and even boycotts of companies seen as supporting controversial government policies. In an increasingly interconnected and globalized world, companies cannot afford to ignore the social and political implications of major policy shifts like those proposed by Project 2025.