New Study Finds 1 in 3 Layoffs in 2025 Tied to Government Efficiency Cuts

A sweeping federal restructuring effort is driving historic job losses. In 2025, the Department of Government Efficiency (DOGE) accounted for nearly 287,000 layoffs, reshaping agencies and accelerating unemployment across the country.

• 287,000 federal jobs lost due to DOGE restructuring

• 744,308 total layoffs in the first half of 2025

• 220% increase in layoffs year-over-year in the East and Southeast

You can see the full study here.

The Restructuring Fallout Federal agencies have borne the brunt of DOGE’s cost-cutting measures. The Department of Health and Human Services, the Department of Education, and USAID are among the hardest hit, with thousands of workers suddenly displaced. For many, the cuts were not only unexpected but also poorly timed, coming amid broader economic volatility.

National Impact Beyond Agencies While the national unemployment rate held steady at 4.2%, that figure hides the ripple effects of government cuts. The 744,000 layoffs recorded in the first half of 2025 mark the highest six-month total since the COVID-19 pandemic. DOGE’s role accounts for more than one-third of those losses, underscoring how federal restructuring can destabilize the broader economy.

Regional Stress Points The East and Southeast are shouldering disproportionate impacts, with layoffs up 220% year-over-year. The fallout isn’t evenly distributed: California leads unemployment at 5.4%, while South Dakota maintains the lowest rate at 1.8%. Mississippi saw the sharpest year-over-year increase (+1.1%), reflecting how policy-driven cuts can exacerbate regional vulnerabilities.

The Broader Picture These losses add to layoffs in other sectors. Tariff-driven global trade tensions cut more than 154,000 jobs in finance, and retail lost 80,000 positions, a 255% spike from 2024. While healthcare and social assistance added 73,000 jobs in July, those gains are overshadowed by large-scale cuts elsewhere.

Five insights from the findings:

• DOGE restructuring caused 287,000 federal job losses in 2025.

• 744,308 total layoffs in the first half of 2025 — highest since 2020.

• East and Southeast layoffs rose 220% year-over-year.

• California unemployment at 5.4%, Mississippi saw largest YoY increase (+1.1%).

• Federal cuts compound layoffs in finance (154,000) and retail (80,000).

A spokesperson at Levine and Wiss emphasized how DOGE’s actions highlight the risks of top-down restructuring: “Restructuring was intended to improve efficiency, but it has instead created unprecedented federal job losses. Nearly 287,000 public sector employees lost their livelihoods in a matter of months. These cuts don’t just shrink government — they destabilize families, communities, and regional economies, with consequences that extend far beyond the agencies themselves.”