As of Feb. 13, 77,000 employees accepted the offer, according to White House press secretary Karoline Leavitt.
Before discussing DOGE, let’s go over the US Department of Labor Unemployment Claims for the week ending February 15.
Initial Unemployment Claims
- In the week ending February 15, the advance figure for seasonally adjusted initial claims was 219,000, an increase of 5,000 from the previous week’s revised level. The previous week’s level was revised up by 1,000 from 213,000 to 214,000.
- The 4-week moving average was 215,250, a decrease of 1,000 from the previous week’s revised average. The previous week’s average was revised up by 250 from 216,000 to 216,250.
Initial Claims and 4-Week Average
Initial claims were rangebound for all of 2022, between 200,000 and 225,000. Weather related spikes occurred in 2023 and 2024 but have since settled down.
What has increased is the difficulty of finding another job once you lose one.
Continued Unemployment Claims
Continued Claim Numbers
- The advance number for seasonally adjusted insured unemployment during the week ending February 8 was 1,869,000, an increase of 24,000 from the previous week’s revised level.
- The previous week’s level was revised down by 5,000 from 1,850,000 to 1,845,000. The 4-week moving average was 1,862,500, a decrease of 7,750 from the previous week’s revised average. The previous week’s average was revised down by 1,250 from 1,871,500 to 1,870,250.
Continued claims spiked twice, stabilized, then spiked a third smaller time and stabilized again.
4-Week Moving Average of Continued Claims Since 1968
The combined takeaway is that companies are still not letting a lot of workers go, but when you do lose your jobs it is increasing harder to find a new one.
Continued claims have held steady since mid-October. However, that is a mirage.
Once a person uses all their benefits, they lose their unemployment benefits.
Expiring Unemployment Benefits
- Most states offer 26 weeks of unemployment benefits.
- Many states with a maximum of 26 weeks use a sliding scale based on a worker’s earnings history to determine the maximum number of weeks they qualify
- Arkansas, Iowa, Oklahoma, South Carolina, Missouri, North Carolina, and Kentucky have a lower number of week.
- Massachusetts allows up to 30 weeks depending on conditions. Montana allows 28 weeks of benefits.
Those are maximum benefits. People who have job-hopped don’t start out with 26 weeks of unemployment.
So at a bare minimum, we need to think of continued claims plus those unemployed 27 weeks or longer.
Unemployment Level 15+ Weeks and 27+ Weeks
The BLS benchmark revision for 2024 plunged the 15+ unemployment numbers from 2.89 million to 2.60 million.
Notably, this sudden decrease reset my 15+ weeks recession indicator.
Continued Claims and 27+ Weeks Unemployed Detail
Benchmark revisions also impacted 27+weeks unemployment numbers.
But factoring in expired benefits, the proper reading for continued claims is 3,315,000 not the reported 1,869,000. This assumes the BLS numbers make any sense.
The Department of Labor numbers do make sense. People like money so they file claims, except perhaps illegal immigrants.
No DOGE Impact
- Initial claims for UI benefits filed by former Federal civilian employees totaled 613 in the week ending February 8, an increase of 14 from the prior week.
- There were 7,110 continued weeks claimed filed by former Federal civilian employees the week ending February 1, a decrease of 335 from the previous week.
Congrats!
“So, congrats, I suppose, to the 77,000 people who get an eight-month vacation,” Leavitt told NewsNation.
Those who accepted the offer are still getting paid so there should be no unemployment claims related to the 77,000 layoffs for 8 months.
Since they are still technically working, if they take another job, the BLS will see this as a new job. However, these persons will likely take a job from someone else who would have gotten one.
So expect to see an increase in the number of people working multiple jobs (assuming the BLS surveys properly). Since my assumption may easily be wrong, the most likely way is a double-counting of jobs.
This should not impact employment levels (other than take a job from someone who otherwise may have gotten one), but we are dealing with the BLS.
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Every February the BLS does annual benchmark revisions for the prior year. This year there were huge revisions.
There should be no impact at all. 200,000 is a tiny sliver of the number of government jobs ADDED during the past year or two. At the V.A., all I heard was “We need office space, we’re hiring. We’re bringing in more people. We need to consolidate offices and share space for more hires.”
Was it true that in the last quarter of Biden’s Administration there was job growth of +360,000 and it all ended up being government jobs? Not sure if it was, but noone can deny that the government workforce exploded upward during Biden.
And why wouldn’t it? Every year saw record budgets, and the policy of all government agencies is: when you get the money, you spend the money. Otherwise, you may not get it again next year. So they spent it by hiring like crazy.
But who did they hire and for what purpose? Just to spend money? Or to build a huge cadre of loyal party supporters within the federal bureaucracy?
Whatever the case, all of the distortion can be found in the insane hiring push during the past year or more.
None of the personnel who take the DOGE “Deferred Resignation” offer are eligible to file for UI benefits, so there should be zero impact on UI claims from them.
Many will retire, others are already looking for new jobs, the early trickles into the private sector, before their colleagues are fired and flood the private sector. Their colleagues will be eligible for UI.
I think there could be a significant effect on the unemployment rate (and likely many regional economies) will be if they successfully lay off the 200,000 probationary* employee + layoffs from local governments, universities, and nonprofits that are affected by the slowdown/pullback in grant disbursements. 200k is enough to jump the unemployment rate by 10+ basis points, and I would guess the spillovers/multipliers will magnify this effect.
*It appears that if you are promoted to a new division you are considered probationary even if you have many years of services.
So far no impact
I doubt 200,000
And if they are paid for 8 months no impact till then
Discussed at length
https://mishtalk.com/economics/how-will-77000-doge-terminations-impact-unemployment-and-jobs/
Unfortunately, it will be worse than people think. As former Assistant Secretary of the Treasury, Paul Craig Roberts, has been saying, the employment/unemployment statistics are BS, and have been for decades, because they keep re-defining what the terms mean to make the numbers look better.
“”So, congrats, I suppose, to the 77,000 people who get an eight-month vacation,” Leavitt told NewsNation.”
FFS. It’s not an 8 month vacation.
If the employee accepts the offer, they go on administrative leave on Feb 28th and are paid through Sept 30th. That is 7 months, 2 days.
And considering they were already going to get 4 federal holidays off in that timeframe anyways had they stayed, the net is not even 7 months.
This all assumes that this plays out as the employees have been told in the 7 or so “Fork in the Road l” emails that have been sent by “HR”.
I’m not sure what your point is here, TD, but splitting hairs over holidays over a 7 month period? Really? If someone asks what you did for vacation, it is ok to say “I went to the beach for two weeks” and not have to clarify that Memorial Day fell in the middle, so it doesn’t count against your annual leave. And they get that day in the “7 months” because they get paid for holidays, and when they leave or retire they get paid for unused vacation hours. In fact, we’d plan vacations around holidays so as to not burn an additional vacation day or two (think Christmas and New Years).
When Covid hit, the friend I spoke about in an earlier comment took advantage of remote work options to work from his eventual forever home, knowing full well if he ever got forced back into the office he’d probably retire. Then this opportunity popped up. He put in his retirement papers over a week ago. He has no office in DC to clean out, his “office” is off his living room in his forever home. Wife already lives there, too. He’s already turned in his work phone and laptop. So Feb 28? That’s an “official date,” not the date his admin leave functionally started. (Do you really think managers are loading down short-timers with work due by Feb 28?)
And as I wrote before, he’s not done on Sept 30, but December 31st. (Not sure how, I should have asked him last night when I had dinner with him.) And he is far from alone in getting his exit extended to year end. For him that’s another quarter of a year at his $254K salary (nice pay for a non-manager); another $5K+ in employer match to his 401K; another week+ of vacation, for which he will get paid out in January; another 3+ days of sick leave earned, which matters if it pushes him over another 30 day level in his balance and therefore gives him a slight bump in his time-in-service calculation towards his pension. Additionally, those extra 3 months will give him more time earning his salary this year, which bumps up his “high 3,” thereby also boosting his pension.
A sweet deal.
Need to add in the 200,000+ people that are on probation that are being let go.
Hopefully it will soak up a bunch of the openings at corporations and companies I read about.
What Trump and DOGE are doing is not that unusual. New presidents routinely clean house then add people based on their priorities. Biden fired all the Keystone XL workers and funded the welcome wagon on the southern border. Trump will fire the welcome wagon and hire manpower to support the deportation process.
Trump is drawing more attention by giving it a fancy name and hiring the richest man in the world to carry out his orders. And of course you have the media continually blabbering about DOGE. Once you strip this all away it’s not that different than what Biden did.
Per Mish’s point, employment will probably net out in the end.
8 months? One of my best friends just put in his retirement papers to retire taking this 8 month freebie, only he called me a couple of days ago to gloat about the fact that Admin Leave will allow him to keep getting paid through to the end of the year. That also then means his 401K’s will continue to get matched. So he’ll get full pay a few extra months, rather than his retirement annuity which would be roughly 60% lower. I don’t know how widespread this is, but for some it isn’t 8 months, it’s over 10. He has been done for a week now, so that makes 10 1/2 months from the date he stopped working through when he’ll continue to get his full pay, healthcare benefits, and 401K match out to over $20K a year. That doesn’t suck.,
So he can turn his annual leave in and get paid for it. And if he is under FERS, his unused sick leave can be counted towards his years of creditable service down to the month. If there is any sick leave he has that does not add up to a month. he loses it. He can use that sick leave up, but it has to be for a legitimate purpose.
All this to say, not sure how he is extending this to 8 or even 10 months unless he is using up sick leave that doesn’t add up to a month or he is using his vacation time instead of getting paid for it. As I posted above, it isn’t 8 months. It is Feb 28 to September 30.
Are layoffs going to impair people from getting checks such as Social Security and similar payouts? answer is no.
Is it going to lessen the need for Treasury to issue debt? If jobs do not exist then that saves payroll. Us government is so antiquated in how it processes things a simple upgrade in Tech will boost efficiency for those employees that remain.
What it will do is reduce need of Federal Government to shake down taxpayer to support DC plantation.
Returning funds back to the people who earn it will help ease financial pressure on civilian wallets.
Will market take notice of some changes in unemployment numbers, probably not. Nobody believes them in any case.
The gov will cut debt before issuing payments to shingle mums, small business people…to spend, to consume. The elderly, the poor and the caste people will get support. The rest will work to regain their dignity and earn money to feed their family, especially those on the 27+ weeks (in yellow).
Assuming someone happens to be affected who is qualified for payments it will surely get micro-phoned in News outlets.
Trump gives impression they can do both, cut Debt issuance and give taxpayers a break.
If economy weakens, as I believe it will, Trump will issue DOGE checks. For no other reason then as confirmation that his administration is doing what he said, reducing tax burden on working people.
Musk says he believes 2 trillion in spending cuts will be found. Sure hope he is right. Be a game changer for US. How is Congress going to ignore those kind of amounts just to have business as usual. Once identified it can not get undone.
How will Hakeem the regime change affect the economy and employment after Mar 14.
No problem Mish; they can pick straw flowers and artichokes as new members of the United Farm Workers union as the illegal aliens are deported and E Verify is enforced in all 50 states and territories. What’s a good equal opportunity for Jose and Yolanda Torres is a good equal outcome for Bernie and Samantha Power’s marginal utility. .,
“As of November 2024, there are just over 3 million federal employees in the United States. This includes both full-time and part-time workers across various federal agencies.”
If we’re going by percentages, since the government hasn’t had layoffs in years, laying off 20% would be an opportunity to clear out the deadwood. Some depts will be hit hard (post office) and others less so. Every company goes through this. Government is not a jobs program. You either show value or your role needs to be 86’d. Set forth policies that lay off the ‘not meeting performance goals’ every year to provide an opportunity to fix hiring mistakes.
I’m a Fed and while there may be (IS) tons of deadwood, neither the normal procedure for clearing it (a RIF) or what Trump is doing (a clusterf*) will succeed in clearing the people who need to go.
Firing new people (the gist of what happens with either approach above) kills off the superstars in that cohort and they’ll never apply to gov again. The only people who will apply in the future will be people who can’t get hired anywhere else. Meanwhile, the cockroaches survive, sitting on 15, 20, even 30 years of “service” that protects them from layoffs. Nearly everybody has perfect reviews, so it’s pointless using those to differentiate (nice thought though).
Frankly the only way to do this wouldn’t be legal: tell each agency they need to cut X% and that the method is to have each office vote their colleagues off the island, iteratively, until that percentage is reached. We all know who the freeloaders amongst us are. My office could cut our worst 40% and not suffer at all in terms of fulfilling our mission.
I live in Titusville, Florida, across the Indian River Lagoon from Kennedy Space Center. Probably half the folks who live in my neighborhood work for the space program. Three of my neighbors had planned to retire this year, and all three are taking the package. All were planning on retiring in the next few months, but prefer to get paid for the next 8 months and do nothing, as opposed to getting paid for work. The young guys are all bailing and applying to SpaceX or BlueOrigin. The kid (young engineer) across the street said he’ll still feed off the taxpayer dime, Elon just has to get his cut first.
I used to live there when I was an adolescent back in around 1970. I loved that place and had a couple of summer jobs at Kennedy Space Center. I especially liked Playalinda Beach which at the time was a complete wilderness. All our neighbors were engineers who worked at the Cape.
ZH had a nice chart with unemployment claims spiking hard in … DC! Lulz. You really have to wonder why 4 out of top 7 highest income counties in the country are DC suburbs. Because DC produces absolutely nothing.
you can thank the patriot act and the absurd amount of cash congress appropriated for natsec after 911. that’s when everything really went off the scales
if you actually rewind the tape, it all happened on the tail of world war II, that is when the military industrial complex was baptized into the government, the spy agencies created, and the widespread classification of normal information was instituted to hide financial and other crimes.
Every “event” was a justification to add another layer of greed, avarice and malfeasance to the festering thing born out of the war.
The OSS guys were real entrepreneurs. I think the bureaucratic side of the Agency was problematic.
https://www.salon.com/2012/12/02/better_than_bourne_who_really_killed_nick_deak/
Absolutely. It was also the time when biowarfare / defense really picked up speed, pulling along the entire bio / pharma / Frankenstein / Mengele complex.
Here’s my take.
DOGE will create an army of gov “quiet quitters” who will bring all government activity to a crawl by doing very little or nothing. This will cause business disruption and chaos possibly leading to more layoffs. This will be inflationary.
Trumps tariff talk has already distorted the labor market as global firms are re-evaluating if they wish to continue to do business with the U.S. Even if any company decides to build a plant in the U.S. to avoid tariffs, it will take years to build and Trump will be out of office in 4 years or maybe 2 if he gets impeached with a change in Congress. This will be inflationary.
We’ve seen significant fallout from Canada boycotting travel, goods and services in the U.S., this will cause more layoffs. Escalating trade war will be inflationary.
In the background, we still have 10,000+ boomers retiring every day and hitting the socialist dole. According to the SS snapshot, 144,000 newly minted socialists enrolled in socialism bringing the number up to 73 million. Handing out free money and subsidized care to 73m people is, by definition, inflationary.
There are rumors of a $5000 check from “DOGE savings” that will be inflationary.
Adding it all up, it’s a one-way trip to inflationville.
“It’s turtles all the way down and inflation all the way up!”
Re “We’ve seen significant fallout from Canada boycotting travel, goods and services in the U.S.”
We have? Got any data for this?
There are news articles all over the place and I’ve posted a few but if you want to scroll through examples, visit the /r/BuyCanadian subreddit. Saw a video clip of a Canadian grocery store where Canadian produce was all sold out and the only thing left on shelves were American produce.
Desantis said he’s not worried but he should be….
https://www.disneytouristblog.com/canada-boycott-disney-world-deals-crowds-candian-cancellations/
well if there are news articles, it must be true.
Statements suffixed with “Everyone says so!” are the only ones you can believe.
KTLA just had a story about Disney being concerned that some of their patrons think that the price for visiting their theme park is getting too high.
terminate the mouse jigglers. Makes it easy.
What are you going to live on in your retirement? Your good looks?
The millions I have….and my good looks.
“According to the SS snapshot, 144,000 newly minted socialists enrolled in socialism bringing the number up to 73 million. Handing out free money and subsidized care to 73m people is, by definition, inflationary.”
Are you calling people who paid into SS all their lives and applied to collect socialists?
If so, can you show me where they signed a contract with Uncle S(h)am to have 6.2% of their salary confiscated by Uncle S(h)am and placed into a Ponzi fund as a condition of their being able to work to earn a living?
If the people collecting are merely getting back the principal that was confiscated by Uncle S(h)am (as opposed to principal and any interest or dividends from the time value of the money), then is it really *free* money from their standpoint? If you want to consider it free money from Uncle S(h)Sam’s standpoint, then I’d agree.
The sky is falling! The government must save us!
We’ll just fix the numbers it’ll be fine.
@ Mish, I absolutely love the Hide Comments feature on this blog. Very cool.
Rugged conservatives always flee to a safe space when their fee fees get hurt, then brag about it. Its not the flex you think it is.
It depends. Were those 77000 government employees doing any work close to what they were getting paid?
government pay is crap. The real issue with government workers are the generous benefits and pension. I think you can retire after 20 years of service and get paid the rest of your life, or at least it was like that at one point. That’s the issue and cost with the structure of government workers.
That’s only the military. And that pension is crap after 20 years for enlisted guys, though upper rank officers can make a bundle. Regular government workers don’t even get pensions anymore. They have a 401k style plan with their money going into an annuity. Federal pay is a little above average, mostly because they outsource most of the lower-end work, and actually outsource the higher end work (think engineering and building fighter jets).
They get a pension. FERS. Federal Employee Retirement System. That, combined with the 401(k) Thrift Savings Plan and Social Security, is their retirement. Before FERS there was Civil Service Retirement System. People under CSRS did not participate in Social Security. The cutoff was in the early 1980s.
Plenty of openings for the job descriptions “…where nobody here will do the work” the past 50 years.
We’ll get the farm labor for free from Wellness Farms, where our unmedicated mentally ill population will be freed from their burdens through toil. Ol’ worm brain came up with the idea, and I think it’s splendid.