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Trump's Second Term Economy: Jobs and Federal Workers Go Missing Together

KEY POINTS

  • Donald Trump began his second presidential term in 2025 with ambitious trade, immigration, and workforce reforms.
  • Federal employment declined 9% by December due to buyouts and reduction-in-force strategies from the Department of Government Efficiency.
  • Despite sluggish job growth and tariff uncertainty, the economy saw GDP expansion in Q2 and Q3 while consumer spending remained robust.

2025 marked the start of Trump’s second term presidency, where economic plans shuffled like a bad poker hand. Federal jobs dropped 9% by December thanks to reduction buyouts run by the Department of Government Efficiency—not to be confused with a department to create jobs. Meanwhile, the US added a stratospheric 584,000 jobs, the lowest growth since 2003 outside recessions, because companies got cold feet from tariff uncertainties and immigration puzzles. Baby Cameron Hilaker, an ex-emergency manager laid off last spring, became a stay-at-home dad avoiding a $2,500 daycare bill. Despite this, GDP kept growing in Q2 and Q3 after tanking in Q1—because businesses were busy preparing for new tariffs while customers still emptied their wallets under one Big Beautiful Bill’s tax cuts. White House spokesperson Kush Desai said Trump delivered 'over a dozen' trade deals, drug pricing 'history,' and cooled inflation—but didn’t specify if layoffs counted as part of that economy 'growth'.

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Source: Businessinsider | Published: 1/20/2026 | Author: Madison Hoff,Allie Kelly