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With Government Savings Nowhere to be Seen, Musk Demands More Large-scale Layoffs

Musk's efforts have not slowed government spending so far. A Reuters analysis of Treasury data shows that the government spent $710 billion during Trump’s first month in office, up 13% from the same period last year.

Allwork.Space News TeambyAllwork.Space News Team
February 26, 2025
in News
Reading Time: 3 mins read
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With Government Savings Nowhere to be Seen, Musk Demands More Large-scale Layoffs

Elon Musk attends the first cabinet meeting hosted by U.S. President Donald Trump, in Washington, D.C., U.S., February 26, 2025. REUTERS/Brian Snyder

U.S. President Donald Trump’s administration on Wednesday directed federal agencies to prepare for more large-scale layoffs that would further thin the ranks of the U.S. civil service.

The memo calls for a “significant reduction” in headcount, but does not specify how many workers should be laid off, beyond the 100,000 who have already taken a buyout or been fired.

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Agencies would have to submit plans by March 13, a day before current government funding is due to expire, according to the memo signed by Russell Vought, the White House budget director, and Charles Ezell, acting head of the Office of Personnel Management.

The memo came shortly before Trump convened his first cabinet meeting with billionaire Elon Musk, who is leading a radical downsizing effort that aims to cut $1 trillion from the $6.7 trillion federal budget. Musk attended the meeting, wearing a black baseball cap, but did not sit at the table with Trump and cabinet officials.

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At the same time, Trump is pressing Congress to pass tax cuts that would reduce government revenues by trillions of dollars, a move that independent experts say would worsen the nation’s heavy debt load.

Late on Tuesday, Republicans advanced a plan with a 217-215 vote in the House of Representatives that would cut taxes by $4.5 trillion and reduce spending by up to $2 trillion. They now are considering cuts to health and food aid for the poor, though specifics have yet to emerge.

Musk’s efforts to slash spending have plunged the government into chaos, upending construction projects and freezing scientific research across the country.

It has also put him at odds with some senior members of Trump’s administration, who were caught by surprise by a Saturday email directive to the nation’s 2.3 million civilian federal workers to justify their jobs. Some agencies told employees to ignore Musk’s demand.

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Musk has kept pressing for workers to respond. Trump told reporters on Tuesday the request was “somewhat voluntary, but it’s also if you don’t answer, I guess you get fired.”

Musk’s efforts have not slowed government spending so far. A Reuters analysis of Treasury data shows that the government spent $710 billion during his first month in office, up 13% from the same period last year.

That increase is largely driven by mounting interest costs related to the nation’s $36 trillion debt load, as well as rising health and retirement costs incurred by an aging population.

Doubting DOGE

Twenty-one workers resigned from Musk’s Department of Government Efficiency in protest on Tuesday, saying they did not want to use their skills to dismantle public services or jeopardize Americans’ personal data.

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Musk’s team has sought to access sensitive payment, health, tax and personnel records, raising privacy and security fears.

Federal judges have questioned the secrecy of DOGE’s activities.

Musk spent much of Tuesday railing against federal judges who have stepped in to block his team from accessing sensitive systems and data at the Treasury Department, Education Department and the Office of Personnel Management. 

“The only way to restore rule of the people in America is to impeach judges,” Musk wrote on X. “No one is above the law, including judges.”

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Impeaching a federal judge would require the support of two-thirds of the 100-member Senate, where Republicans hold a 53-47 majority.

The downsizing effort has fired at least 25,000 and offered a buyout to 75,000 of the nation’s 2.3 million civil service workers.

Most workers fired by DOGE so far were in their jobs for less than a year, making them easier to lay off under civil service rules. But there were signs that DOGE was turning its attention to long-term career staff. 

Internal Revenue Service executives have been told to brace for another round of job cuts beyond the nearly 12,000 employees already slated to be terminated, two people familiar with the matter said. The cuts so far amount to more than 10% of the service’s workforce.

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The Interior Department was told on Tuesday that bureaus such as the U.S. Fish and Wildlife Service and the Bureau of Indian Affairs should prepare plans for workforce reductions ranging from 10% to 40%, an Interior source told Reuters.

(Additional reporting by James Oliphant; Editing by Scott Malone, Deepa Babington and David Gregorio)

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Source: Reuters
Tags: North America
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Allwork.Space News Team

Allwork.Space News Team

The Allwork.Space News Team is a collective of experienced journalists, editors, and industry analysts dedicated to covering the ever-evolving world of work. We’re committed to delivering trusted, independent reporting on the topics that matter most to professionals navigating today’s changing workplace — including remote work, flexible offices, coworking, workplace wellness, sustainability, commercial real estate, technology, and more.

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