Before Trump, some states had already ended affirmative action for contractors – here’s what happened
Contractors affected by affirmative action bans at the state level saw a drop in employee head count but were no less likely to go out of business.
Following President Trump's order in 2021 to dismantle affirmative action programs, several states had already ended such preferences for contractors. This has raised questions about how businesses owned and operated by underrepresented groups fared after these measures took effect. Economists have found a mixed picture with some surprising conclusions.
While the average head count among minority- and women-owned contractors did decrease, these measures did not push these companies to close shop. The U.S. spends about 10% of its GDP on federal and state contractors, so understanding these changes is crucial.
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