Federal Administrative Leave Cost $9.5 Billion in 2025
A federal workforce reduction program triggered a 435 percent surge in administrative leave costs for taxpayers.
Updated on Sept. 18, 2026 in Employment
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In 2025, the U.S. government paid $9.5 billion in administrative leave to federal employees, marking a 435 percent increase compared to 2023 levels. This surge occurred as the administration implemented a program to reduce the federal workforce.
Why it matters
The program was intended to shrink the federal government size and spending, yet it resulted in significant short-term payouts during 2025. This dynamic contributed to a broader fiscal outlook where federal spending is projected to climb.
Federal agencies paid for 21.6 million work days of administrative leave in 2025. This activity supported a workforce reduction that lowered the total number of federal employees from 3 million in early 2025 to 2.7 million by August 2026.
The players
The Office of Personnel Management
The federal agency that manages human resources and benefits for the government workforce.
The Trump administration
The presidential office responsible for setting workforce reduction policy and fiscal strategy.
The details
The government launched a deferred resignation program in early 2025 that led to 140,000 workers leaving their posts. Participants who resigned by February 12, 2025, were placed on administrative leave and received continued pay through September 2025. While 20,000 of these positions were eventually refilled, the total headcount dropped by approximately 10 percent over the observed period.
Timeline
2023 served as the baseline for administrative leave spending.
January 2025 marked the start of the workforce reduction efforts.
February 12, 2025, was the final deadline for employees to join the deferred resignation program.
September 2025 concluded the payment period for workers in the program.
August 2026 saw the federal payroll settle at 2.7 million workers.
Money Landscape
The use of the deferred resignation program reflects a shift in federal staffing policy under the Trump administration. This action sits against a backdrop of rising federal budget deficits and projections for higher total government spending.
The multi-billion dollar increase in administrative leave costs is a factor in the broader federal budget deficit. Households may monitor future federal spending projections to understand the potential for future policy changes or tax implications.
The takeaway
The government paid $9.5 billion in administrative leave as part of a strategy to reduce the workforce by 10 percent. Readers should track upcoming federal budget disclosures to see how these administrative costs and the projected $400 billion spending increase impact national fiscal health.
Further reading
For more on national labor trends, see the Employment section.
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