White House Warns of Mass Layoffs if Democrats Force Shutdown

White House press secretary Karoline Leavitt is warning that federal agencies are preparing for mass layoffs if Democrats continue to block a stopgap spending bill and allow the government to shut down at the end of the month.

The warning came as Congress neared a Tuesday midnight deadline to avert a shutdown. While the Republican-led House approved a short-term continuing resolution last week, the measure has stalled in the Senate, where Democrats are demanding additional provisions.

“There will be layoffs if Democrats don’t keep the government open,” Leavitt said during the daily press briefing. “We are nearing a government shutdown; we are nearing a funding deadline. The president wants to make this deadline. He wants to keep this government open.”

Leavitt accused Democratic leaders of playing politics at the expense of federal workers and taxpayers.

“The president is giving Democrat leadership one last chance to be reasonable, to come to the White House today to try to talk about this, and now is not the time to try to get political points against Donald Trump,” she said.

The White House Office of Management and Budget (OMB) circulated internal guidance to agencies instructing them to prepare reduction-in-force (RIF) plans in case a shutdown takes effect on October 1.

According to the memo, employees working on programs not legally required to continue without appropriations should expect to receive both furlough and RIF notices.

“With respect to those federal programs whose funding would lapse and which are otherwise unfunded, such programs are no longer statutorily required to be carried out,” the guidance stated. “RIF notices should be issued to all employees tied to those programs.”

The memo also directed agencies to revise staffing levels once Congress approves appropriations for fiscal year 2026, retaining only employees necessary for core statutory functions.

In unusually sharp language, the guidance accused Democrats of derailing what has historically been a bipartisan process.

“While Congress has usually passed short-term funding bills on a bipartisan basis, Democrats this year are making insane demands, including $1 trillion in new spending,” the document said. “Those demands risk forcing a shutdown.”

At issue is the Senate’s refusal to advance the House-passed H.R. 5371, a “clean” continuing resolution that would extend current funding levels through November 21. The Trump administration has endorsed that measure, with Leavitt calling it a “commonsense” approach.

“All we are asking for is a commonsense, clean funding resolution to keep the government open,” Leavitt said. “The president supports enactment of a clean CR to ensure no discretionary spending lapse after Sept. 30, 2025, and OMB hopes the Democrats will agree.”

President Trump has already overseen significant workforce reductions during his current term through buyouts and targeted layoffs. Administration officials have touted those cuts as part of an effort to shrink the federal bureaucracy. A shutdown, however, could accelerate those efforts, particularly if Democrats refuse to accept a stopgap measure.

The dispute has been further complicated by Democratic demands for expanded health care access to illegal immigrants, a proposal Trump has flatly rejected amid his broader immigration crackdown. Since returning to office in January, Trump has presided over the deportation or voluntary departure of an estimated 2 million people.

Federal agencies have already begun implementing contingency plans. Non-essential employees are bracing for furloughs, while contractors face uncertainty about payments.

Markets are also watching closely; previous shutdowns have rattled investor confidence and disrupted federal services ranging from food safety inspections to passport processing.

Leavitt emphasized that the administration still hopes to avoid disruption.

“We remain hopeful that Democrats in Congress will not trigger a shutdown and the steps outlined above will not be necessary,” she said. “But federal agencies must prepare for all outcomes.”

With just hours before the deadline, the standoff remains unresolved — and the jobs of tens of thousands of federal employees hang in the balance.