Fired Federal Workers Could Work Factory Jobs Created by Tariffs: Bessent

Treasury Secretary Scott Bessent has suggested that those who have been laid off from their jobs in the federal government will be able to take on new jobs created as tariffs rehouse manufacturing in the U.S.

“So what we are doing: on one side, the president is reordering trade. On the other side, we are shedding excess labor in the federal government and bringing down federal borrowings,” Bessent told Tucker Carlson on Friday. “And then on the other side, that will give us the labor we need for the new manufacturing.”

Newsweek has reached out to the Treasury Department for comment.

Why It Matters

Despite legal pushback and forced reinstatements of fired workers, the Department of Government Efficiency (DOGE) has continued on its quest to slash the federal workforce, with hundreds of thousands let go across dozens of agencies by some estimates.

What To Know

The transcript of the interview put out by the Treasury Department on Tuesday differs slightly from the comments made by Bessent in his interview on April 4. In the footage posted to Carlson’s YouTube channel, the Treasury secretary states that the federal government layoffs “will give us” an additional labor force, rather than “we will have the labor we need for new manufacturing.”

U.S.-based employers announced 275,240 job cuts in March, a 60 percent increase from February, according to outplacement firm Challenger, Gray & Christmas. This marks the third-highest monthly total since the firm began tracking data in 1989. Only April and May of 2020 saw higher numbers—671,129 and 397,016 cuts, respectively—during the early months of the COVID-19 pandemic. Challenger attributed 216,670 of these job cuts to the actions of DOGE, including its direct layoffs and the cuts caused by the “downstream effect of cutting federal aid or ending contracts.”

Experts recently told Newsweek that the DOGE-driven layoffs have further saturated the labor market, resulting in too few job openings and leaving many unable to find comparable roles to those they performed while in government.

Bessent framed DOGE’s efforts as part of a two-prong plan to put the U.S. economy back on course. The Treasury Secretary told Carlson that trimming down the federal workforce and cutting government spending would “substantially” cut expenses, while President Donald Trump’s tariff plans would generate “substantial tariff revenue.”

What People Are Saying

Treasury Secretary Scott Bessent, in his interview with Tucker Carlson, said: “Right now we’re in this strange ‘betwixt and between,’ because we’re going to take in substantial tariff revenue. And what DOGE is doing is substantially cutting expenses. But we’re not getting credit for it right now. I think the market’s starting to get a hint of it. The 10-year bond, which had almost peaked at 5 percent, is now through 4 percent. A way to think about it is: every 100 basis points is about $1 trillion in savings. So we’ve saved $100 billion. That’s probably not going to happen that quickly again. But I think we are setting the sails for a much better fiscal time. People don’t have to say, ‘The U.S. is out of control. The U.S. is going to default.’ We’re not. And I think every day, my case gets better.”

Indeed economist Allison Shrivastava previously told Newsweek: “Ultimately, the overall job market’s ability to absorb cuts will depend largely on the types of jobs workers are looking for and a rebound in employer hiring and confidence.”

Şebnem Kalemli-Özcan, professor of Economics at Brown University, previously told Newsweek: “First and foremost, every reason the administration gives to justify tariffs is wrong: tariffs do not decrease US overall trade deficit (unless you shut down entire trade with everyone), tariffs do not bring jobs back and tariffs do not mean foreigners take advantage of us taking our wealth.”

What Happens Next?

Trump’s flat 10 percent tariffs on all imports took effect on Saturday, with the “reciprocal” tariffs set to follow on Wednesday.

Elon Musk announced he will step away from his role at DOGE by the end of May, stating he expects to meet his goal of cutting federal spending by $1 trillion by then.