White House prepares mass federal layoffs ahead of shutdown

The White House has notified U.S. agencies to ready themselves for large-scale federal employee dismissals if the government shuts down in the coming days.

In a memo released Wednesday night, the OMB stated that agencies should consider workforce reductions for federal programs whose funding will expire in the coming days, lack alternative resources, and do not align with the priorities of President Donald Trump.

Mass layoffs, not furloughs

According to the Associated Press, this action is far more aggressive than past shutdowns, when non-essential employees were simply furloughed but returned to work after Congress approved funding.

Workforce reductions not only result in employee terminations but also eliminate positions entirely—a move that would bring another major transformation to the federal workforce, which has already faced large-scale reductions this year due to efforts by the “Government Efficiency” office and other Trump administration agencies.

According to a memo first reported by Politico, agencies are required, after any potential shutdown ends, to review their workforce reduction plans “to ensure that the minimum number of employees necessary to carry out legal functions remain in place.”

This OMB directive significantly increases the potential consequences of a government shutdown in the coming days and heightens pressure on Senate Minority Leader Chuck Schumer and House Minority Leader Hakeem Jeffries.

These two leaders have kept nearly all Democratic lawmakers united in resisting a simple funding bill proposed by Trump and Congressional Republicans, which would keep the federal government running for seven more weeks. Instead, they are demanding immediate health care reforms.

In statements released shortly after the memo, both Democrats showed no signs of backing down.

Jeffries wrote on X: “We will not be intimidated by your threat of mass layoffs. Go away!” He also called OMB Director Russ Vought a “destructive political hack.”

Schumer said in a statement that the OMB memo is “an attempt at intimidation” and predicted that “any unnecessary layoffs will either be overturned in court or the government will be forced to rehire employees.”

The OMB noted that it had already held its first planning call with other federal agencies to prepare for a possible shutdown.

The OMB plays a central role in managing U.S. federal government shutdowns, particularly in advance planning.

Previous OMB offices have also published contingency shutdown plans on their website—plans specifying which agency employees would remain at work and which would be furloughed—but this time, such a publication has not occurred.

Budget battle in Washington

The memo emphasized that Congressional Democrats are withholding support for the simple funding bill due to “partisan demands,” which include extending enhanced health insurance subsidies set to expire at year-end, as well as repealing Medicaid cuts included in the GOP tax and spending legislation.

The memo stated: “Therefore, it has never been more important for the government to be prepared for a shutdown if Democrats choose that path.”

It also noted that the Republicans’ flagship legislation, including the large tax and border spending package, “provides sufficient resources to ensure the uninterrupted continuation of many of President Trump’s key priorities.”

The OMB directed all agencies to submit their plans for a potential shutdown by August 1.