The USAID freeze: Thousands of American jobs at risk
Shreeaa Rathi | TIMESOFINDIA.COM | Feb 04, 2025, 23:41 IST
( Image credit : TIL Creatives )
The Trump administration's freeze on USAID funding threatens thousands of American jobs and impacts national security and global health efforts. Aid contractors are furloughing staff, leading to widespread economic fallout. The freeze affects USAID's role in combating extremism and infectious diseases worldwide. The decision is causing political turmoil and damaging international trust in USAID projects.
Widespread Job Losses and Economic Fallout
"People are losing their jobs left and right," said one humanitarian official. "There’s going to be a ripple effect."
Large aid contractors such as DAI and Chemonics, which employ thousands of people worldwide, have been hit particularly hard. DAI has already furloughed nearly 70% of its U.S.-based workforce, while Chemonics has not received payments for any contracts since Trump’s inauguration last month, forcing them to furlough over 600 employees.
The National Security and Public Health Implications
"Dismantling and pausing foreign assistance will make America more vulnerable to possible terror attacks since much of what USAID does is to target the root causes of extremism worldwide," said a USAID employee stationed in Africa.
Additionally, the funding freeze could have a direct impact on global health security. USAID funds programs that combat infectious diseases, including HIV and malaria. Experts caution that a resurgence of these diseases abroad could eventually affect the United States.
"Maybe people don’t realize that what happens abroad hits us here," another source in the development sector explained. "It is not in our interest to have a resurgence of HIV in Africa or malaria spiraling out of control."
Political and Institutional Turmoil
Secretary of State Marco Rubio has since confirmed that he is now the acting administrator of USAID, solidifying the agency’s takeover by the State Department. This marks a dramatic restructuring of America’s foreign aid infrastructure, with uncertain implications for international development and diplomatic relations.
A Grim Outlook for the Future
"Our word is trash," said one USAID contractor, reflecting on the damage done to America's credibility in the global development sector.
John Oldfield, CEO of Accelerate Global, a firm that advises nonprofits and development companies, emphasized that aid organizations do not have the financial reserves to weather prolonged funding gaps.
"Yes, people are losing their jobs—whether you're a billion-dollar USAID contractor or a small subcontractor in rural East Africa," Oldfield explained. "These organizations solve today’s problems with today’s money. They don’t have massive rainy-day funds."
As the situation unfolds, the future of USAID remains uncertain, but one thing is clear: the effects of this decision will be felt far beyond Washington, reaching American workers, international allies, and the communities that depend on U.S. assistance worldwide.