Full Breakdown
Trump Administration Pays $9.5 Billion for Federal Employees’ Paid Leave to Shrink Workforce
By Drooid · · How we work
Core Action and Scope
In 2025 the Trump administration allocated $9.5 billion to place federal employees on paid administrative leave, effectively paying them not to work. The program, administered by the Department of Government Efficiency, was designed to reduce the size of the civil service by encouraging “deferred resignations.” The Government Accountability Office (GAO) reported that use of paid administrative leave rose 435 percent during the first year of President Trump’s second term, a six-fold increase since 2023.
Policy Background
The paid-leave initiative is part of a broader effort announced by the administration to cut “frivolous and wasteful” federal spending. Early in the second term, officials pledged to achieve $1 trillion in savings; the administration later claimed that the effort had generated more than $200 billion in savings, though outside experts have not independently verified that figure.
Financial Impact and Context
Spending on civilian salaries and benefits represents a relatively small share of the total federal budget, yet it was among the first targets for cost reductions. While the paid-leave program cost $9.5 billion in 2025, the federal deficit continued to grow after President Trump’s return to office, a trend attributed in part to the 2025 war in Iran and the sweeping tax cuts enacted that year.
Official Statements
Treasury Secretary Scott Bessent emphasized that the initiative reflects a “commitment to fiscal responsibility” and signaled that additional spending cuts were forthcoming. The GAO’s report provided the quantitative basis for the reported increase in paid administrative leave usage.
Implications
If the paid-leave strategy succeeds in prompting permanent resignations, the federal workforce could shrink, potentially lowering long-term personnel costs. However, critics note that the $9.5 billion outlay may offset short-term savings, and the lack of independent verification of the claimed $200 billion in savings leaves the overall fiscal impact uncertain.