The “DOGE” Effect: Federal Layoffs Drive March Job Losses to 36-Year High
Over the past two months, federal government job cuts have surged, impacting 280,253 federal workers and contractors, as reported by outplacement firm Challenger, Gray & Christmas. In addition, the reduction of federal aid and the termination of contracts have resulted in 4,429 further job losses, primarily affecting non-profits and health organizations.
U.S. employers announced 275,240 job cuts in March, a 60% increase from February. This figure represents the third-highest monthly total since tracking began in 1989, exceeded only by April 2020 with 671,129 cuts and May 2020 with 397,016 cuts.
“Job cut announcements were dominated last month by Department of Government Efficiency (“DOGE”) plans to eliminate positions in the federal government. It would have otherwise been a fairly quiet month for layoffs,” Andrew Challenger, SVP for Challenger, Gray & Christmas.
U.S. employers announced 497,052 job cuts in the first quarter of 2025, marking the highest quarterly total since the first quarter of 2009. This figure reflects a 93% increase from the same period in 2024 and is more than triple the number of job cuts reported in Q4 2024.
The U.S. government has announced 279,445 job cuts so far this year, a staggering 672% increase from the 36,195 cuts in the first quarter of 2024. In contrast, the technology sector reported 15,055 job cuts in March, a 3% rise from February, though its year-to-date total of 37,097 is 14% lower than the same period last year.
“Several sectors will be impacted by tariffs going forward, including Consumer, Auto, and Retail. These sectors are already cutting more workers than last year,” said Challenger.
Job cuts in the first quarter of 2025 surged across retail, consumer products, and automotive sectors compared to the previous year. Retailers announced 57,804 cuts, a 37% increase, including 11,709 in March alone. Consumer products manufacturers reported 14,619 cuts, up 54%, while automakers recorded 7,146 cuts, a 28% rise. In contrast, financial firms saw a 44% decrease, with 15,982 cuts year-to-date.