The number of federal workers filing for new unemployment benefits has dropped. Further, for the week ending March 15, 821 initial claims had been filed under the Unemployment Compensation for Federal Employees program. This is a decrease from 1,066 claims submitted the week prior. The Labor Department on Thursday announced a dip in new jobless benefit claims. New claims for the week ending March 22 came to 224,000 — 1,000 fewer than the revised numbers for the week before.
So, as a result, an unprecedented number of federal workers are looking for work in non-government positions. Recent data highlights a notable increase in job applications from those affected by changes in the Department of Government Efficiency. Though initial unemployment claims have held relatively steady, the job market finds itself in a precarious balancing act.
Impact on Federal Workforce
With a recent transformation in federal operations, as many as 250,000 federal employees were suddenly unemployed and looking for new work. In past years, presidential inaugurations have triggered an increase in the number of job applications from federal employees. This year’s figures have reached a truly staggering level.
“We’ve been a little bit frozen for a while; you’ve seen those headline (jobs) numbers, and frozen is a kind of stability,” – Allison Shrivastava
The present labor market—which is only expected to become even tighter—makes hiring extremely competitive. Businesses are reeling from the uncertainty President Donald Trump’s economic agenda has caused them. This nervousness is responsible for a slowdown in hiring across the board, particularly for specialized and white-collar jobs.
Though the mood is anxious, the labor market is still holding steady if not “a touch frozen.” Second, job growth has decelerated significantly over the past year. This adjustment is understandable given things such as the amorphous nature of election year and a correction after prior over-hiring. On top of all of this, increasing costs and high-interest rates have created a “double whammy” effect for employers.
The stability of the labor market is tenuous, as continued uncertainty would have deeper effects.
“But the longer that goes on, the more likely it is that we’ll have impacts … like frostbite.” – Allison Shrivastava
Increased Job Searches Among Federal Workers
Clogged federal hiring Data from employment search site Indeed shows sharp upticks in the share of current federal workers searching for new roles. Just in February DOGE-adjacent job applications were up 50%, closing out the month 75% above where it was in 2022. This wave of reorganization highlights the profound effect such government restructuring can have on the workforce.
This is part of a larger trend where federal employees are forced to adjust to rapidly changing socio-economic career landscapes. This change takes them far outside their purpose. Economists point to many reasons for these changes in behavior, such as the uncertainty of election-year politics, rapidly escalating inflationary pressures and interest rates at a 23-year high.