The District of Columbia could lose 40,000 federal jobs over the next several years, a 21% reduction according to the city’s CFO Glen Lee.
Forecast Significantly Revised
On February 28th, DC revised its revenue forecast for the District of Columbia Budget and Financial Plan, with a $1.01 billion reduction spread over three years, approximately $342 million per year.
The District’s most recent 28th consecutive clean annual audit confirmed the city’s strong financial standing, Aaa bond rating, fully funded pensions, and 52 days cash reserves. The downward revision reflects the significant impacts of federal job losses.
Mayor Bowser released the following statement:
“The real-life impacts of federal job losses will be felt in many ways, here in Washington, DC, throughout the National Capital Region, and across the country. Today’s estimates show the significant financial impact on Washington, DC, and with this estimate, we will need to significantly reshape our upcoming budget proposal. In addition to building the best infrastructure for the federal workforce, we have attracted great private sector opportunities in our city – hospitality and tourism, education and health care, sports and entertainment, technology and so much more. Now, more than ever, we need to be strategically focused on investing in the growth of our local economy to bring more good-paying jobs, companies, and economic activity to DC. We will work with our colleagues on the Council to ensure we make it through this together.”
UPDATE JUL 2026: Federal job reductions in the District of Columbia resulted in a net loss of over 22,000 positions and an estimated $3.656 billion in annualized wages, with the city’s overall revenue projected to drop by $1 billion through the multi-year financial plan.
Key Economic Impacts
Wages and Income: The D.C. Office of Revenue Analysis reported thousands of separations including retirements, reductions in force, and terminations.
City Revenue: District officials anticipate a $1 billion revenue decline, creating budget strains for local safety net programs.
Regional Ripple Effects: The broader D.C. metropolitan region lost more than 63,000 federal positions as workforce cuts reduced consumer spending in local businesses.
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