Fed Cites Trump, Musk in Workforce Reduction Plan

The Federal Reserve, under Chair Jerome Powell, plans to reduce its workforce by 10%, or about 2,400 jobs, over the next several years. The reduction will primarily occur through a voluntary deferred resignation program for employees eligible to retire by the end of 2027 and through natural attrition, not layoffs. This move is part of efforts to modernize operations, consolidate functions, and ensure the Fed is right-sized for its mission. The decision aligns with broader federal government streamlining efforts championed by the Trump administration and the Department of Government Efficiency, led by Elon Musk, though the Fed acts independently and is not compelled to follow White House directives. Similar workforce reviews occurred during efficiency drives in the 1990s. Powell assured staff the changes would be made thoughtfully to safeguard the Fed’s core mandates.