The federal government’s huge March job cuts pushed layoff announcements to their third highest level ever recorded. The Department of Government Efficiency is taking courageous steps forward. They are deep vector cutting, canceling contracts and laying to remove 216,215 federal workers. Together, these actions make up almost 80% of the total 275,240 layoffs that U.S. employers have announced thus far this month.
Uncertainty surrounding the federal government’s increasingly aggressive approach is the number one cause driving the increase in layoffs. Monthly job cuts is at the highest level since April and May of 2020. We’ve heard from many of you in the labor movement, particularly as experts warn that these shocks will reverberate throughout the rest of the labor market. Analysts have warned for months that the immediate impact would be unlikely to surface in labor market data or the economy anytime soon. They hope that in the long run, the results will be profound as federal employees either transition to new positions or experience difficulty obtaining employment elsewhere.
This reform, along with changes to immigration and other federal policies, is adding confusion and disruption to an already dramatic, topsy-turvy job market. In just a few days, the Bureau of Labor Statistics will announce the report for March jobs. We’re looking forward to this report shedding light on the effects of federal job cuts on various sectors.
National chief economist at the global consultancy EY-Parthenon Gregory Daco reacted critically to the governments’ pivot. “Cutting (government spending) indiscriminately has no positive effect on any economy,” he stated. He further cautioned, “Moving fast and breaking things is a risky proposition,” highlighting the potential dangers of rapid change without thorough consideration of its impacts.
The federal government is still leaning mightily on the efficiency side of the ledger. Critics like us are finally asking the damaging impact on federal workers and the future federal labor force. This current wave of layoffs is not merely a short-term blip either. It also points to a bigger trend that will eventually upend jobs in every field, including our own.