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Layoff announcements soar to the highest since 2020 as DOGE slashes federal staff

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1 month ago

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Recently fired U.S. Agency for International Development (USAID) staff carry boxes with a message as they leave work and are applauded by former USAID staffers and supporters during a sendoff outside USAID offices in Washington, D.C., U.S., February 21, 2025.

Brian Snyder | Reuters

President Donald Trump’s efforts to pare down the federal government workforce left a mark in the labor market in February, with announced job cuts at their highest level in nearly five years, outplacement firm Challenger, Gray & Christmas reported Thursday.

The firm reported that U.S. employers announced 172,017 layoffs for the month, up 245% from January and the highest monthly count since July 2020 during the heightened uncertainty from the Covid pandemic. In addition, it marked the highest total for the month of February since 2009 during the global financial crisis.

More than one-third of the total came from billionaire entrepreneur Elon Musk’s efforts, with Trump’s blessing, to reduce the federal headcount. Challenger put the total of announced federal job cuts at 62,242, spanning 17 agencies.

“With the impact of the Department of Government Efficiency [DOGE] actions, as well as canceled Government contracts, fear of trade wars, and bankruptcies, job cuts soared in February,” Andrew Challenger, the firm’s workplace expert, said in the release.

January’s planned reductions brought the total through the first two months of the year to 221,812, also the highest for the period since 2009 and up 33% from the same time in 2024.

The report comes amid heightened concern about the state of the labor market and the economy in general as Trump’s plans for tariffs, slashing the size of government and mass deportations and stringent immigration restrictions take shape.

There has been a slew of mixed indicators about where things are heading, with consumer surveys showing concern over inflation and layoffs while other data shows economic strength continuing. Payrolls processing firm ADP reported Friday that private sector hiring grew by just 77,000 in February.

According to the Challenger report, it’s not just government cutting back.

Retail saw 38,956 cuts for the month as companies such as Macy’s and Forever 21 announced sharp staff reductions. The sector’s cuts in 2025 are up nearly six-fold from where they were in 2024. Technology firms also listed another 14,554 in reductions, though the sector’s cuts are actually lower from a year ago.

On the upside, firms announced plans in February to hire a total of 34,580 new workers, putting the year to date total up 159% from a year ago.

Initial unemployment claims have perked up in recent weeks, particularly in Washington, D.C., with its large share of government workers.

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Economics

Trump’s triple-digit tariff essentially cuts off most trade with China, says economist

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9 hours ago

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April 10, 2025

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U.S. President Donald Trump attends a cabinet meeting at the White House in Washington, D.C., U.S., April 10, 2025.

Nathan Howard | Reuters

President Donald Trump’s tariff increase on imports from China would basically end most trade between that country and the U.S., according to economist Erica York.

“It depends on how narrowly the tariff is applied or how broadly it’s applied, but generally if you get north of a triple-digit tariff, you are cutting off most trade,” the vice president of federal tax policy at the Tax Foundation’s Center for Federal Tax Policy said on CNBC’s “The Exchange” on Thursday. “There may still be some things without any substitutes that companies just have to foot the bill, but for the most part, that cuts it off.”

Her remarks came amid the market wiping out some of its monster gains seen on Wednesday. The market accelerated declines on Thursday once a White House official confirmed to CNBC that the U.S. tariff rate on Chinese goods now stands at 145%. That total includes the recent hike to 125% from 84% that Trump announced Wednesday as well as a 20% fentanyl-related duty that the president had previously put into effect.

On Wednesday, Trump announced that he’s temporarily reducing the tariff rates on imports from most countries, except China, to 10% for 90 days. In a Cabinet meeting Thursday, the president declined to rule out the possibility of extending the 90-day tariff reprieve.

Taking into account the China tariffs, the baseline 10% levies still in place and other sector tariffs, Trump has still taken the country into its most protectionist stance in decades, even with the pause.

“It’ll take the average tariff rate still to highs that we haven’t seen since the 1940s, so this is major,” the economist added. “It’s huge cost increases. It’s an economic hit. It’s clearly not setting us on a very good path.”

The Tax Foundation estimates that all of the new Trump tariffs will lead to an increase in federal tax revenues of $171.6 billion for this year. That would make Trump’s tariffs the biggest tax increase since 1993, more than the hikes under both former presidents George H.W. Bush and Barack Obama, the institution revealed.

China has said it won’t flinch if trade dynamics were to escalate into a trade war. Just hours prior to Trump’s tariff pause announcement, China raised its retaliatory levies on U.S. imports to 84% from 34%, which went into effect Thursday.

Even with Trump’s reversal, York stressed that the market isn’t in the clear just yet, saying “it’s not like the threat went away entirely.”

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Trump’s tariff blitz faces strong legal challenges

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13 hours ago

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April 10, 2025

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WITH MARKETS gyrating from the tariffs Donald Trump has imposed on around 180 countries, only to pause some of the most punishing ones on April 9th, a conservative organisation has filed a lawsuit challenging an initial round of tariffs the president announced on Chinese imports in February, duties he has since escalated. The New Civil Liberties Alliance (NCLA), which counts Charles Koch, a right-wing billionaire, among its supporters, argues that the president lacked the authority to impose these levies. With Chinese goods still a prime target, the case retains its salience. Similar lawsuits against other tariffs could yet scuttle the boldest—and most destabilising—move of Mr Trump’s second term.

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Donald Trump wants to deport foreign students merely for what they say

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14 hours ago

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April 10, 2025

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“EVERY TIME I find one of these lunatics I take away their visa.” That is how Marco Rubio, the secretary of state, last month described the Trump administration’s push to deport foreign university students who had participated in campus activism. Mr Rubio initially suggested that his department had cancelled at least 300 visas. That number increasingly looks out of date as the deportation campaign has spread beyond elite east-coast schools and for conduct beyond protest and speech. More than 100 students in California alone have had their visas yanked—some of them seemingly for infractions as minor as a speeding ticket.

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