White House Budget Office Instructs Agencies to Prepare Layoff Plans Amid Possible Shutdown

The White House is telling agencies to prepare large-scale firings of federal workers if the government shuts down next week.

A memo released Wednesday night by the Office of Management and Budget directs agencies to consider implementing a reduction in force for federal programs facing a funding lapse next week, which are not otherwise funded, and don’t align with the President’s priorities. This suggests a more drastic measure than previous shutdowns, where non-essential federal employees were furloughed but returned to work once Congress approved government funding.

Implementing a reduction in force would mean not just temporarily laying off employees but permanently ending their positions, causing further disruption in a federal workforce that has already experienced significant cuts this year due to initiatives by the Department of Government Efficiency and other parts of the Trump administration.

After any government shutdown ends, agencies are advised to adjust their reduction in force plans “as needed to keep the minimal number of employees necessary to fulfill statutory duties,” the memo indicates, as first reported by Politico.

This directive from the OMB magnifies the repercussions of a potential government shutdown next week and intensifies the pressure on Senate Minority Leader Chuck Schumer and House Minority Leader Hakeem Jeffries. Both leaders have largely kept their Democratic members united in opposing the clear funding bill advocated by President Donald Trump and congressional Republicans, which aims to extend federal operations for seven more weeks, insisting on immediate health care improvements in return for their support.

In statements issued shortly after the memo was released, the two Democrats showed no signs of budging.

“We will not be intimidated by your threat to engage in mass firings,” Jeffries wrote in a post on X. “Get lost.”

Jeffries called Russ Vought, the head of OMB, a “malignant political hack.”

In response, Schumer described the OMB memo as an “attempt at intimidation” and predicted that the “unnecessary firings will either be reversed in court or the administration will end up rehiring the workers.”

The OMB mentioned it held an initial planning call with other federal agencies earlier this week to prepare for a shutdown. The budget office plays a central role in managing federal government shutdowns, particularly by planning in advance. Previously, budget offices have published shutdown contingency plans, which explained which agency workers would continue working and which would be furloughed during a shutdown, on their websites, though this office has not done so.

The memo noted that congressional Democrats are refusing to support a clean government funding bill “due to their partisan demands,” which include an extension of enhanced health insurance subsidies set to expire at the end of the year, plus a reversal of Medicaid cuts that were included in Republicans’ big tax and spending cuts law.

“As such, it has never been more important for the Administration to be prepared for a shutdown if the Democrats choose to pursue one,” the memo reads, which also notes that the GOP’s signature law, a major tax and border spending package, gives “ample resources to ensure that many core Trump Administration priorities will continue uninterrupted.”

OMB noted that it had asked all agencies to submit their plans in case of a government shutdown by Aug. 1.

“OMB has received many, but not all, of your submissions,” it added. “Please send us your updated lapse plans ASAP.”