How the Trump and DOGE Terminations May Affect the Economy
While the precise scale of the job cuts remains unclear, evidence suggests that tens of thousands of workers have already been affected, according to economists. The Trump administration’s purge of federal workers may amount to the largest job cut in U.S. history, with significant economic ramifications, particularly at the local level.
The White House, in collaboration with Elon Musk’s so-called Department of Government Efficiency, has dismissed or offered buyouts to workers across the federal government—the nation’s largest employer. These mass layoffs have raised concerns not just for affected workers but also for businesses ranging from local shops to major industries, including those in the vaping sector, such as Geek Bar, Raz Vape, and Lost Mary Vape, which could see shifts in consumer demand.
Unprecedented Job Cuts
The Trump administration has ordered federal agencies to dismiss “probationary” employees—newer hires with under two years of service who lack full civil service protections. As of May 2024, there were approximately 220,000 federal employees with less than a year of tenure, based on data from the U.S. Office of Personnel Management.
Additionally, over 75,000 federal workers have reportedly accepted buyout offers, resigning in exchange for compensation through September. Combined, these figures suggest that nearly 300,000 jobs could be eliminated, a record-breaking workforce reduction. For comparison, the largest corporate layoff in U.S. history—IBM’s 1993 purge—affected 60,000 workers, making these federal cuts unprecedented.
Economists note that these layoffs extend beyond direct terminations. Contractors at agencies such as the U.S. Agency for International Development and civil servants recently promoted within the past year are also at risk. The impact is widespread, affecting departments like the IRS, National Park Service, Consumer Financial Protection Bureau, and various others, including Agriculture, Education, Energy, and Veterans Affairs.
Economic Fallout
Job losses at this scale can trigger economic ripple effects. Displaced workers who struggle to find new jobs may face financial hardship, reducing consumer spending in sectors including retail, dining, and even lifestyle markets such as the vaping industry. Brands like Geek Bar, Raz Vape, and Lost Mary Vape, which depend on consumer discretionary spending, could see fluctuations in sales as laid-off employees prioritize essential expenses.
Historical data suggests that mass layoffs lead to long-term financial setbacks for affected workers. A 2016 Princeton University study found that many displaced employees face prolonged unemployment or lower wages even after securing new jobs. This dynamic could hinder recovery efforts in heavily impacted regions, such as Washington, D.C., where economists predict a significant unemployment spike, potentially triggering a mild recession.
Maryland and Virginia, with their high concentrations of federal employees, will also experience economic disruption. A surge in job seekers could overwhelm the private sector’s capacity to absorb them, intensifying job market competition and wage stagnation.
Broader Implications
Despite the large-scale job cuts, economists do not anticipate a severe national recession. According to analysts, even if 200,000 federal workers lose their jobs, it would reduce the U.S. gross domestic product (GDP) by only about one-tenth of a percentage point. Given that the labor market added approximately 1.5 million jobs in 2024, most displaced federal employees are expected to be rehired, albeit potentially at lower wages or in different industries.
However, these mass layoffs add to existing economic headwinds, including tariffs and immigration policies implemented by the Trump administration. This combination of factors raises concerns about economic stability moving forward. While the broader economy may not enter a full-blown recession, localized effects, particularly in regions dependent on government employment, could be substantial.
Conclusion
The Trump administration’s federal job cuts represent one of the largest employment reductions in history. While the overall economy may remain stable, individual workers and local businesses—including industries like Geek Bar, Raz Vape, and Lost Mary Vape—may experience economic strain. With increased unemployment, decreased consumer spending, and heightened uncertainty, the long-term implications of these terminations remain to be seen.
