DOGE-driven government job cuts push March layoffs to pandemic highs

• In March, 275,000 job cuts were announced, making it the third-highest total since Challenger began tracking layoffs in 1989. Nearly 80% of March layoffs were federal government jobs, driven by DOGE initiatives.
• Technology and retail companies saw the next highest number of reductions.
• The broader impact on the labor market may be gradual as many federal workers remain on paid notice periods.

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March saw a surge in layoffs in the U.S., with job cut announcements reaching the third-highest level ever recorded, according to Challenger. Only April and May of 2020, during the height of the pandemic, saw higher numbers.

According to job placement firm Challenger, 275,000 layoffs were announced in March, the third-largest total since Challenger started tracking data in 1989. The only months with more layoffs were April 2020, with over 671,000 job cuts, and May 2020, with 397,000 layoffs.

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Federal government leads job cuts

Of the 275,000 jobs cut last month, nearly 80% were in the federal government. Challenger reported that the Department of Government Efficiency (DOGE) initiatives were responsible for nearly 217,000 government layoffs.

“Job cut announcements were dominated last month by DOGE plans to eliminate positions in the federal government.” Andrew Challenger, senior vice president at Challenger, said. “It would have otherwise been a fairly quiet month for layoffs.”

Layoffs outside of the government saw technology and retail companies with the next highest number of reductions, with roughly 15,000 and 11,000 job cuts, respectively.

Effects may be gradual

The DOGE-driven layoffs are not all immediate. While some federal workers have already lost their jobs, many are on “paid notice periods,” meaning they won’t be officially unemployed for a few months. As a result, the effects on the broader labor market may be more gradual.

A clearer picture of the overall labor market is expected on Friday, April 4, when the Bureau of Labor Statistics releases its March jobs report.