Trump Announces Buyout Offers, Predicting 2 Million Job Cuts in the US
US President Donald Trump announces buyout offers to federal employees
In a move to reduce federal spending, US President Donald Trump has announced buyout offers to more than 2 million federal employees. This decision affects approximately two-thirds of the federal workforce and is expected to result in the largest single job reduction in US history.
Offer details and impact on workforce
According to a memo from the Office of Personnel Management, the government’s human resources agency, employees who voluntarily leave their positions will receive about eight months of salary until September, provided they opt for the buyout by February 6. The offer is applicable to all federal workers except certain military, postal, or national security personnel.
With the federal government employing over 3 million people, it ranks as the nation’s 15th largest workforce. Forbes estimates that if just 10 per cent of workers accept the buyout offer, it could lead to the sudden loss of over 200,000 jobs, marking the largest single job cut by a US firm in American history.
Executive orders and recent actions
During his second term, President Trump issued several executive orders targeting federal employees. These orders ended remote work arrangements and mandated employees to return to work full-time. Additionally, Trump removed 17 inspectors general from the federal government’s largest agencies, with only one Democratic appointee being spared.
Furthermore, a week into the new administration, 56 senior officials from the United States Agency for International Development (USAID) were placed on leave as part of an investigation into alleged attempts to obstruct Trump’s initiatives.
Potential impact on unemployment
Despite the US unemployment rate standing at 3.6 per cent as of December 2024, a surge of federal employees leaving their positions due to the buyout offers could result in an increase in unemployment. This increase could potentially lead to hundreds of thousands of people joining the job market, temporarily disrupting the stability seen in recent years.
Overall, President Trump’s announcement of buyout offers to federal employees is poised to have significant implications on the workforce and the job market in the United States.