Latest news with #federaljobs
Telegraph
6 days ago
- Business
- Telegraph
How Trump smashed Washington's economy
David is one of thousands of workers in Washington suddenly on the brink of unemployment. He earns more than $80,000 (£59,000) per year but has cut back on spending to save $600 per month. 'I've changed where I buy groceries,' says the 35-year-old. 'If someone's making plans to go out for dinner or go out for drinks, I avoid it.' In preparation for losing his job and potentially leaving the city for good, he recently handed in his notice on his $2,100-per-month rental contract. He is one of many making radical changes after Donald Trump's administration took an axe to the US capital's economy by slashing federal government jobs, funding and grants. The impact of these cuts has so far been delayed as laid-off employees worked through notice periods and severance packages. But unemployment is now beginning to surge, with city residents spending less and the property market coming under pressure. To strengthen his grip on Washington, the US president on Monday took a controversial step to deploy the National Guard as part of a crime purge, claiming the city has become 'overtaken by violent gangs and bloodthirsty criminals'. 'I will make our capital great again!' Trump declared. But away from the drama of the president's announcement, David's situation is emblematic of the fact that the city is teetering on the edge of a recession triggered by Trump's crackdown. In the last financial year, Washington's real GDP rose by 1.5pc. This is expected to fall to 0.9pc in 2025, according to Washington's office of the chief financial officer (Ofco), with a further 1.9pc drop the following year. After Trump re-entered the White House in January, it was Elon Musk who was tasked with slashing $1tn from the federal budget, brandishing a red chainsaw as he got to work. To date, the department of government efficiency (Doge), led by the Tesla billionaire before his falling out with Trump, has claimed savings of $199bn by pursuing mass sackings and offering voluntary redundancy to more than 154,000 federal employees. A strict hiring freeze has also been enforced, which allows only one replacement federal employee for every four that leave. It has also terminated billions of dollars' worth of government grants and contracts, such as all of those with the US agency for international development (USAID). Washington is bearing the biggest brunt of these cuts, with the federal government making up for a quarter (188,400) of all jobs in the city. Since December, the number of federal government workers claiming unemployment insurance in Washington has risen nearly 12 times over to hit 1,502 in July. Excluding short-lived surges during two government shutdowns, this was the highest level on record since 1993. As cuts continue, this number is only going to rise. The district's chief financial officer in February forecast 40,000 federal job losses by 2029. This means that more than a fifth of jobs (21pc) in the city's biggest employment sector will be lost. However, the government extends well beyond the Washington jobs market. A further 170,500 people are employed in professional and business services, which includes government contractors. Another 68,500 work in related services, such as many of the civic organisations that receive government funding. Lucy Dadayan, of the Urban Institute, says: 'The budget cuts aren't just affecting federal workers; there are cuts to grants for non-profits, for research funding, for local government, for health and education programmes. 'And all these cuts, both in jobs and spending have ripple effects that are leading to lay-offs in higher education and hospitals and think tanks and NGOs. 'That's important because a lot of them are heavily clustered in and around DC, and we are starting to see the impact of this in jobs and spending.' Data from Ofco show that Washington recorded a net year-on-year loss of 6,100 jobs in June. Of these, 4,700 were cut from federal government employment, while a further 2,200 disappeared from professional and business services. 'Usually we don't get drops as big as this unless it's a recession,' says Fitzroy Lee, the district's chief economist. Take David as an example. He is not employed by the federal government, but works in international development, a sector heavily reliant on foreign aid. A barrage of federal cuts has meant this sector is now suffering a major downturn, with David's contract soon set to expire. He beat nearly 100 applicants to land his current role and has two master's degrees. But in the last eight months, David has applied for 30 positions and has had no luck. The fact that he is from South America has made his employment status a growing problem, as his visa is tied to his job. When his contract ends, he will have 15 days to leave the country. 'So far this year, I can think of 25 people who I know who have had to leave like this,' he says. Washington's unemployment rate has climbed from 5.3pc at the start of the year to 5.9pc, well above the national average of 4.2pc. Dadayan says the rate could rise as high as 9pc in the next year as more funding cuts filter through. Fresh waves in unemployment are coming in September and another in December, says Yesim Sayin, executive director of the DC Policy Center. Crucially, those losing their jobs are often high earners, meaning they will inevitably be spending less across the local economy. 'There is a multiplier effect for all of those people in the orbit of the federal government,' says Lee. Analysis by ConsumerEdge shows that Washington residents are already cutting back on spending more than the average American. Nationally, residents of major cities cut their spending on restaurants by 4pc year-on-year in June, whereas the drop in Washington was 9pc. The knock-on effects are also showing up in the property market. The number of homes for sale in Washington has surged by nearly a fifth year-on-year, according to Bright MLS. Across the wider metro area, active listings are up by 41pc. However, this rise in supply is not being met by demand. Agreed sales across the metro area were down 1.7pc year-on-year, and properties are taking longer to be sold. This has also led to house price growth slowing to 1.6pc, the slowest rate in two years. Rental landlords also risk being burned as more people like David cancel their contracts. Capital Economics expects the value of managed rental apartments to fall by more than 5pc this year, making the city's rental market the worst-performing in the country. 'Without creating an environment that keeps the talent here, I think the city may kind of go back to the 1990s,' says Sayin. The US fell into a national recession in 1990 and 1991. But while the rest of the country recovered, Washington was then hit by sweeping federal government cuts under President Bill Clinton's 'Reinventing Government' initiative. Between 1993 and 1996, real wages in Washington fell by 7pc – a collective loss of $4bn in today's money according to DC's Ofco. Back then, many federal government jobs were eventually replaced with contractor roles, says Lee. But this time around, that seems unlikely. 'What is on DC's calling card? It's the government. If you take government out of DC, what do we end up with?' says Sayin. 'We lose the glue that holds everything together.'
Yahoo
02-08-2025
- Business
- Yahoo
Jobs report sector breakdown: Healthcare wins, federal jobs lose
The labor market slowed sharply in July with just 73,000 jobs added, falling short of the 104,000 economists had forecast. The unemployment rate edged up to 4.2%, matching expectations. Yahoo Finance Senior Reporter Allie Canal breaks down where the gains and losses were, including big growth in healthcare and continued cuts in federal jobs. To watch more expert insights and analysis on the latest market action, check out more Morning Brief. The July jobs report showing, uh, coming in below expectations, the economy adding 73,000 jobs, much lower than had been estimated and big, big revisions lower for the two prior months. Yahoo Finance markets reporter, Allie Canal, joins me now for a deeper dive into those numbers. Hi, Allie. Hi, Julie. Well, we see on a sector basis, the winners continue to win and the losers continue to lose, and then everyone else just pretty much is in the middle here. So, healthcare adding 55,000 jobs. This is above the average monthly gain of 42,000 over the past year. And over the month, job gains in that sector occurred in ambulatory healthcare services and hospitals. And we've seen healthcare really prop up this labor market over the past year. That continues to be the case today. Social assistance employment also continued to trend up in July by 18,000. This reflected continued job growth in individual and family services. And then federal government, we've been keeping our eye on this as those layoffs continue to make their way through the system. That declined by 12,000 and is down by 84,000 since reaching a peak in January. Remember that employees that are on paid leave or receiving ongoing severance, they are counted as employed in this establishment survey. So, potentially more pain ahead there for federal government. But then little change for a lot of these other major industries, and as you guys were just discussing, we are in this environment where it's low hire, low fire. So again, gains concentrated in healthcare, losses in federal government, Julie.
New York Times
01-08-2025
- Business
- New York Times
Federal Government Shed 12,000 Jobs in July
The federal government continued to shed jobs in July as the Trump administration aggressively downsizes the federal work force. Federal government jobs decreased by 12,000 last month, according to the Labor Department's monthly employment report on Friday. Since its peak at the beginning of the year, the federal government has lost 84,000 jobs. Number of employed federal workers, in millions Data is seasonally adjusted. Source: Bureau of Labor Statistics Elena Shao The decline is the latest indication that President Trump is shrinking the federal work force significantly. On Thursday, the Office of Personnel Management, the government's human resources arm, said that the Trump administration was paying about 154,000 employees not to work since it began offering resignation incentives to federal workers. But even that number, which represents only the share of workers who accepted an offer to resign early in exchange for months of pay, does not capture the full employment picture. It does not include the thousands of people who were laid off or fired.
Forbes
31-07-2025
- Business
- Forbes
62,000 Jobs Were Lost In July—With DOGE, AI And Tariffs To Blame, Report Says
American employers have already cut more jobs this year than in all of 2024, a new report showed Thursday, following cuts to federal government jobs, artificial intelligence and President Donald Trump's tariffs. Fired US State Department workers carry their belongings as they leave the building in Washington, DC, on July 11, 2025. AFP via Getty Images Private and public employers cut 62,000 jobs in July, according to a report from career services firm Challenger, Gray & Christmas, an almost 30% increase from the month before and a 140% spike over the same month last year. More than 806,000 jobs have been cut to date in 2025, already above the 761,358 that were eliminated in all of 2024. The Department of Government Efficiency's cuts to federal agencies and grants, as well as implementation of artificial intelligence and concerns over Trump's tariffs, are largely responsible for the cuts, according to Andrew Challenger, senior vice president and labor expert for Challenger, Gray & Christmas. The government has cut 292,294 jobs this year—the leading sector in job reductions by far—followed by technology at 89,251 and 80,487 job cuts in retail. Get Forbes Breaking News Text Alerts: We're launching text message alerts so you'll always know the biggest stories shaping the day's headlines. Text 'Alerts' to (201) 335-0739 or sign up here : The Challenger report says so-called "DOGE impact" is the leading reason for job cut announcements so far in 2025. President Donald Trump initiated the biggest singular cut to jobs in U.S. history early this year when he offered more than 2 million people a buyout. Roughly 65,000 people had accepted the offer within two weeks, while 24,000 cuts were made in the U.S. Army and 10,000 in the Veterans Affairs department, among thousands of others. In addition to the direct cuts to the federal workforce, DOGE cuts to grant funding have also led to 17,826 cuts in the non-profit sector so far this year, up 413% from this time in 2024, Challenger said. Non-profit organizations have cited mounting challenges from reductions in federal funding, rising operational costs and persistent economic uncertainty. Technology is the leading private sector in job cuts, with 89,251 eliminated in 2025 so far. Challenger says the advancement of artificial intelligence and ongoing uncertainty surrounding work visas have contributed to workforce reductions, which are up 36% in the sector over the same time period last year. So far in 2025, companies that have undergone large-scale layoffs so far this year include Intel (21,000), Microsoft (15,000 across two rounds of layoffs), PayPal (2,500) and HP (2,000). How Have Tariffs Impacted Job Cuts? The retail and automotive sectors have seen an increase in layoffs as the result of global tariffs implemented by the Trump administration. Retail announced 80,487 job cuts in July, up 249% through this time in 2024, citing tariffs, inflation and ongoing economic uncertainty. Auto makers have cut 16,883 jobs this year, down from last year, and primarily cited tariffs for the losses as well as fluctuations in production demand, supply chain disruptions and increased operational costs Contra U.S. companies have said they plan to hire 86,132 people so far this year, up from the 73,596 through the same period in 2024, Challenger reports. The entertainment and leisure sector is responsible for nearly a third of the hiring plans, which Challenger says could reflect a rebound in seasonal and service-related roles. Insurance employers have planned 12,800 hires and the automotive sector has also announced 6,161 new jobs. Hiring is down year-over-year in the technology, construction, industrial goods and energy sectors. What To Watch For Friday's jobs report. The unemployment rate dipped to 4.1% in June after sitting at 4.2% from March to May, according to the latest data. Job growth was 37% lower in the first half of 2025 compared to 2024. Forbes Fed Decides Against Interest Rate Cut—But Powell Faces First Double Dissent In Decades By Ty Roush Forbes U.S. Economy Rebounded In Second Quarter As GDP Rises 3% By Ty Roush Forbes Labor Market Stays Afloat As Hiring Tops Forecasts—Again By Derek Saul
Yahoo
09-07-2025
- Business
- Yahoo
Covington mayor addresses loss of federal jobs, revenue to the city
Amid a budget crunch after hundreds of federal jobs were eliminated in Covington, causing a massive loss in payroll tax, we sat down with Mayor Ron Washington to see where his priorities lie for the city's spending.
