VA targets 585 ‘non-mission critical’ contracts for elimination
March 4, 2025Pentagon aims to accelerate acquisition of new tech through software-contracting change
March 9, 2025
The Trump administration‘s sweeping cuts to the federal workforce are slated to damage the D.C.-area economy and dramatically lower the city’s tax revenues, a new report projects.
D.C.’s Office of the Chief Financial Officer, in its new revenue forecast released Friday, estimates the city will bring in $21.6M less this year and an average of $342.1M less over the following three years than its December forecast predicted. The total decline adds up to just over $1B in reduced revenue between now and the end of fiscal year 2028.
The report cites the Trump administration’s recent moves to slash the federal workforce as the primary reason for the declining projections, along with the domino effect that is expected to have on the local economy.
“Due to ongoing and planned federal workforce reductions, the District’s economic outlook has deteriorated significantly from the December forecast,” D.C. Chief Financial Officer Glen Lee said in the report.
A quarter of all civilian District jobs are government jobs, the report says, a factor that makes it uniquely vulnerable to federal workforce changes.
The CFO predicts the city will lose 40,000 federal jobs by 2029, a 21% reduction in that sector.
Lee estimates that D.C. is expected to hit a “minor recession” in fiscal year 2026 and begin a gradual recovery in fiscal year 2027. He highlighted the domino effect the cuts are expected to have across the region, beyond just the federal workforce.
