Latest news with #governmentlayoffs
Yahoo
14-07-2025
- Business
- Yahoo
Federal job cuts set off retirement surge, planning challenges
A sharp rise in federal retirements, coupled with an expected wave of more government layoffs, is prompting high-stakes career decisions for many federal employees. Through June, more than 72,000 federal employees have filed retirement claims with the Office of Personnel Management, data shows. That represents a 38% increase in claims compared to the same period last year, driven by a wave of cuts across federal agencies by the Trump administration. Starting in late January, Elon Musk and his Department of Government Efficiency (DOGE) worked to cut tens of thousands of federal workers. But even after Musk's departure, the Trump administration has made clear that it intends to continue downsizing the federal workforce. Last week, the Supreme Court ruled that the Trump administration could move forward with extensive government job cuts. Thousands of federal employees across more than a dozen agencies, including the Departments of Agriculture, Commerce, Health and Human Services, State, Treasury, and Veterans Affairs, are slated for dismissal. READ MORE: Trump's megabill passed — here's what advisors should know Financial advisors who specialize in working with federal employees say the options available to their clients have become clearer compared to the start of the year. "Earlier this year, there was so much more uncertainty around what the options were, and so in some ways … some discussions were driven by a lot of fear, because of the uncertainty of just not understanding what the deferred resignation program really looked like and whether it was legal and things like that," said Amy King, founder of Instar Financial Planning in Fallston, Maryland. "Now there's not so much uncertainty anymore. It's really just that they've made their decision. Now how do we effectively plan, given the decision they've made and the timeline that we know about." Still, continued cuts across the government, as well as uncertainty around future regulations, make navigating retirement decisions for current federal employees difficult. "In some cases, whole offices have basically stopped having any work come down to them, like they're just being totally hobbled and cut out at the knees," said Andrew Katz-Moses, founder of Katz-Moses Financial in Washington, D.C., "So they're very interested in exploring if it's possible for them to actually retire." Making that determination looks different for every worker, but advisors point to a couple of common considerations. Federal workers considering retirement can have a variety of potential offers available to them, each with its own set of rules and financial implications. For many, the choice revolves around a handful of options, including the voluntary early retirement authority (VERA), the voluntary separation incentive payment (VSIP) — commonly known as a buyout — and, in some cases, agency-specific initiatives such as a deferred resignation program (DRP). "I would say 75% of the new clients that I've received, federal employee clients that have come in, are looking at whether or not they can accept the deferred retirement offer that came out earlier, and several of them are taking it," King said. "Several have taken the voluntary early retirement authority, the VERA, in conjunction with DRP." READ MORE: Coping with brutal Efficiency: How advisors are helping federal workers For eligible workers, deferred retirement could also be an appealing option, but it comes with implications of its own, King said. "If they're leaving and they're going to end up with a deferred retirement, which means that it's not going to kick in until probably 62 maybe as early as 57, what are they doing in between when they retire, until they're eligible to collect their annuity?" King said. "What are they doing for health care? What are they doing for income? What are their options for whether or not the Federal Employee Health Benefit kicks back in or not? So it's not just the standard stuff that normally comes with financial planning around literally, like, 'Can I retire?' It's also the benefits part of it." Beyond the finances, advisors say that many federal employees are also having to factor in assumptions about the future of the government into their decision. Earlier this year, some 40,000 federal employees resigned through the Trump administration's fork-in-the-road offer, according to the Federal News Network. Now, many of the workers who declined to take that offer find themselves in limbo. "Sometimes it makes a lot of sense, like they should take it, and sometimes they also have to think about, okay, if they don't take it, what's the risk that they come back and get fired anyway, and now they've not taken this buyout that was on offer," Katz-Moses said. As a new wave of federal layoffs ramps up, advisors say that it's easy for workers to feel overwhelmed by all of the variables at play. That's why it is crucial to talk about emotions first before jumping into logistics, according to Katz-Moses. READ MORE: A checklist for advisors assisting federal employees "I always like to check in on the emotions first and [say] like, 'Let's step back. Let's get out of the numbers and the logistics for a second. What do you really want right now? What's most important?'" he said. "'Even given all the turmoil and tumultuousness of what's happening right now, if this goes really well, what will happen for you?' Start to, you know, vision out what that ideally looks like, and then we have to look at the numbers."
Japan Times
20-05-2025
- Business
- Japan Times
Trump's mass layoff threat drives U.S. government workers to resign
Tens of thousands of U.S. government workers have chosen to resign rather than endure what many view as a torturous wait for the Trump administration to carry out its threats to fire them, say unions, governance experts and the employees themselves. U.S. President Donald Trump signed an executive order on taking office to dramatically slash the size and cost of government. Four months later, mass layoffs at the largest agencies have yet to materialize and courts have slowed the process. Instead, most of the roughly 260,000 civil servants who have left or will leave by the end of September have taken buyouts or other incentives to quit. Some said they could no longer live with the daily stress of waiting to be fired after multiple warnings from Trump administration officials that they could lose their jobs in the next wave of layoffs. As a result, Trump and tech billionaire Elon Musk's Department of Government Efficiency have managed to cut nearly 12% of the 2.3 million-strong federal civilian workforce largely through threats of firings, buyouts and early retirement offers, a review of agency departures found. The White House did not respond to a request for comment for this story. Trump and Musk say the federal bureaucracy is bloated, inefficient and beset with waste and fraud. The White House has yet to provide an official tally of the number of people leaving the federal workforce. It said 75,000 took the first of two buyout offers but has not said how many took a second buyout offer last month. Under the program, civil servants will receive full pay and benefits through September 30, with most not having to work during that period. Deep cuts are earmarked for several agencies, including over 80,000 jobs at the Department of Veterans Affairs, and 10,000 at the Department of Health and Human Services. Since January, many government workers have spoken of living in fear of being fired. Many agencies have sent regular emails to staff that couple incentives to quit with warnings that those who stay face the possibility of being laid off. They have also endured cramped offices after Trump ordered all remote workers to return to work and dysfunction inside their agencies caused by a brain drain of experienced workers. U.S. President Donald Trump has said the federal bureaucracy is bloated, inefficient and beset with waste and fraud. | reuters Don Moynihan, a professor at the Ford School of Public Policy at the University of Michigan, said a series of moves by DOGE and Trump have worn down the early defiance of many civil servants and led them to leave the workforce, a strategy that avoids the legal pitfalls of firing them. They include the first buyout offer, which told workers they needed to leave their "lower productivity" jobs; a demand by Musk for workers to summarize five things they had achieved at work in the previous week, and workers being asked to do jobs they were not trained for. "It's inappropriate to think of these as voluntary resignations. Many of these employees feel that they were forced out," Moynihan said. Charlotte Reynolds, 58, took an early retirement offer and left her job as a senior tax analyst at the tax-collecting Internal Revenue Service on April 30. Reynolds chose not to take the first buyout offer in January, deciding to tough things out. By April she had had enough. "They told us we weren't productive, we weren't useful. I've devoted 33 years to working for the IRS and I worked hard. It made me feel horrible," Reynolds said. Everett Kelley, president of the American Federation of Government Employees, the biggest federal workers' union with 800,000 members, cited comments made by Trump's budget chief Russ Vought when he said government workers needed to feel "trauma." "When they wake up in the morning, we want them to not want to go to work," Vought said in 2023 at an event at the think tank he founded, the Center for Renewing America. "The president has empowered people like Elon Musk and his DOGE team to harass, insult, and lie about federal employees and the work they do and force tens of thousands of employees off the job," Kelley said. Vought did not immediately respond to a request for comment. An employee at the Social Security Administration, which oversees benefits for older and disabled Americans, said he decided to take the second buyout offer, in part because the uncertainty of what might happen to him each day took a toll. Speaking on condition of anonymity, for fear of having the buyout offer rescinded, the worker said the stress led him to stay up later, drink more and exercise less. "There were definitely moments when I felt defeated," the worker said. "It turned your world upside down." Dozens of lawsuits have challenged Trump administration efforts to fire federal workers. In the broadest ruling so far, a California federal judge on May 9 temporarily barred layoffs at 20 agencies including the departments of Agriculture, Health and Human Services, Treasury and Veterans Affairs and said workers who had already lost their jobs must be reinstated. The administration is appealing the ruling, which said Trump can only restructure federal agencies with authorization from Congress. The lack of mass layoffs at big agencies to date does not mean Trump won't trigger them in coming months, especially if the legal obstacles to mass firings are lifted by appeals courts.
