ADVOCACY & POLICY UPDATE - December 22, 2025

Congress Breaks for Recess Without Funding Deal; Mack Confirmed

Washington Update

Appropriations

Lawmakers adjourned for a two-week holiday recess without passing any of the remaining 9 appropriations bills or finalizing a health care deal to extend the enhanced Affordable Care Act (ACA) premium subsidies, setting the stage for significant insurance cost increases for millions of Americans in 2026. Despite weeks of negotiations and last-minute votes, Congress failed to reach a bipartisan compromise before leaving Capitol Hill, and the appropriations measures remain unresolved ahead of the January 30 deadline to avoid a partial government shutdown. Lawmakers are scheduled to return the first week of January 2026.

No legislative action on the remaining spending bills has occurred since the vote to reopen the government after the previous shutdown. House Appropriations Chair Tom Cole (OK) and Senate Appropriations Chair Susan Collins (ME) are negotiating overall funding totals for the remaining bills, including Defense, Labor-HHS-Education, and Energy-Water, with agreements already reached on six others.

On Thursday, December 18, progress on a five-bill FY26 minibus — which covers Labor-HHS-Education, Defense, Interior-Environment, Transportation-HUD, and Commerce-Justice-Science — was delayed in the Senate due to holds from Democratic Senators Michael Bennet (CO) and John Hickenlooper (CO) and other procedural issues, leaving the chamber without a vote. Bennet and Hickenlooper sought guaranteed funding for the National Center for Atmospheric Research.

Former Department of Education officials have urged Congress to include language in the funding bills reversing recent program transfers, such as Title I and IDEA funds, made by the Trump Administration. Unresolved issues also include FY26 text for the Homeland Security and State-Foreign Operations bills, necessary to begin bicameral negotiations. With the holiday recess underway, Congress has only a few weeks to finalize the remaining nine appropriations measures and prevent a partial funding lapse.

DOL ETA Assistant Secretary Confirmation

On Thursday, December 18, 2025, the U.S. Senate confirmed Henry Mack III as Assistant Secretary of Labor when it adopted S. Res. 532 by a vote of 53–43. Assistant Secretary Mack, who has a wealth of experience in workforce development, previously serving on CareerSource Florida’s state workforce board and as Chancellor of Florida’s Department of Education, will lead DOL’s Employment and Training Administration (ETA). We look forward to working with him and the U.S. Department of Labor to elevate the priorities of mayors and the local workforce system, ensuring small businesses have the skilled talent they need to thrive and jobseekers have access to opportunities for skill and career development.

U.S. Department of Education

On Monday, December 15, the U.S. Department of Education announced the launch of the Connecting Talent to Opportunity Challenge — a grant competition to development and promote statewide digital systems, called Talent Marketplaces, that integrate workers’ credentials, learning and employment records (LERs), and related information to better align skills with job opportunities. 

Starting in January 2026, governors can work with Perkins, adult education, and workforce partners to build or scale Talent Marketplaces, including Credential Registries, LERs, and Skills-Based Job Description Generators. These systems aim to expand access to career pathways, support skills-based hiring, and increase labor force participation. Up to 10 semi-finalists and finalists will receive technical assistance to refine and implement their plans and may share in a $15 million prize pool.

Click here to access the press release about the Connecting Talent to Opportunity Challenge.

Administration and AI

The Trump Administration’s efforts to assert federal authority over artificial intelligence (AI) regulation is creating uncertainty for employers navigating an expanding patchwork of state and local laws. Earlier this month, President Trump signed an Executive Order (EO) aimed at preventing state and local governments from adopting regulations the Administration views as barriers to AI development. The order directs the formation of a task force to challenge laws it considers unconstitutional interference with interstate commerce, drawing criticism from some Republicans.

Despite the Administration’s intent to challenge certain laws, employers are still required to comply with state and local regulations unless they are overturned. New York City has enforced rules governing AI use in hiring for several years, and states including California, Colorado, Illinois, and Texas have enacted laws that are already in effect or set to take effect. These measures often include protections against discriminatory hiring practices or disclosure requirements when AI tools are used to evaluate job applicants. The divergence between federal and state approaches raises concerns that some employers may comply while competitors do not, anticipating federal intervention.

Legal experts have questioned whether the federal government can preempt state and local AI regulations without explicit congressional authorization. The White House is still prioritizing AI policy and signaled a willingness to challenge state authority, particularly as technology companies have not secured a comprehensive legislative solution from Congress. As most states implementing workplace AI regulations are led by Democratic governors, with Texas as an exception, conflicts between federal and state governments are widely expected. 

U.S. Tech Force

On Monday, December 15, the Trump Administration unveiled a new initiative called the U.S. Tech Force, a two-year program of roughly 1,000 engineers and specialists working on artificial intelligence infrastructure and other technology projects across federal agencies. Participants will work with teams reporting directly to agency leaders and collaborate with private sector partners. After completing the program, participants may pursue full-time employment with partner companies, which have committed to consider program alumni for jobs. Private partners may also nominate their employees for temporary government assignments. Annual salaries are expected to range from $150,000 to $200,000, plus benefits. Tech Force members will focus on high-impact technology initiatives, including AI implementation, application development, data modernization, and digital service delivery throughout the federal government. 

Click here to access the Tech Force website.

Click here to access the OPM press release on the Tech Force.

Justice Department DEI Memorandum Opinion 

On Friday, December 19, the Justice Department made public a 48-page memorandum opinion determining that multiple U.S. Department of Education programs contain unconstitutional race-based provisions, as the Trump administration continues efforts to scale back diversity, equity, and inclusion (DEI) initiatives in education. The memorandum concluded that race-based components of certain U.S. Department of Education programs are unconstitutional and inseparable from their broader statutory frameworks. According to the Justice Department, the determination affects approximately a dozen programs, including those serving Hispanic-Serving Institutions, Alaska Native and Native Hawaiian-Serving Institutions, Native American-Serving Non-Tribal Institutions, Native Hawaiian Career and Technical Education programs, and formula-based funding for Predominantly Black Institutions. The Justice Department stated that funds appropriated for these programs may be repurposed or reprogrammed under appropriate circumstances.

The memo also indicated that some programs could continue if race-based eligibility criteria are removed. These include competitive grant programs for Predominantly Black Institutions, as well as the Minority Science and Engineering Improvement Program, the Ronald E. McNair Postbaccalaureate Achievement Program, and Student Support Services. In addition, the Justice Department rejected a provision in the Higher Education Act that limits direct access to federal student aid application data to two scholarship-granting organizations.

The memorandum follows comments earlier this year by Secretary of Education Linda McMahon, who said her agency would stop distributing funds through Minority-Serving Institution grant programs that rely on enrollment thresholds tied to specific racial or ethnic groups. On Friday, McMahon said she would work with Congress to reform the affected programs and stated the Department of Education is evaluating the full impact of the opinion and will release additional information at a later date. McMahon said she agrees with the Office of Legal Counsel’s findings that federal education funding programs cannot use race-based criteria to determine eligibility.

Click here to access the full memorandum opinion.

Unemployment Rate

On Tuesday, December 16, the U.S. Department of Labor (DOL) Bureau of Labor Statistics (BLS) released the November 2025 jobs report - delayed by the government shutdown. The report showed that nonfarm payrolls grew by 64,000, better than the Dow Jones estimate of 45,000 and up from a sharp decline of 105,000 in October. The unemployment rate rose to 4.6% — more than expected, and its highest level since September 2021. 

Click here to access the full BLS jobs report.

Click here to access Secretary of Labor Lori Chavez-DeRemer’s statement on the November jobs report.