Federal government employs thousands in KY. What if they take Trump’s ‘buyout’ offer?
Thursday, a federal judged paused a controversial deferred resignation program for federal workers issued by President Donald Trump’s administration aimed at cutting the size of the federal government.
The offer, extended with a Thursday, Feb. 6 deadline, allows federal employees to leave their jobs voluntarily and be paid through Tuesday, Sept. 30, according to CNN.
“If you resign under this program, you will retain all pay and benefits regardless of your daily workload and will be exempted from all applicable in-person work requirements until September 30, 2025,” the U.S. Office of Personnel Management memo states.
The deferred resignation offer is part of a larger effort by the Trump administration to levy heavy cuts across the federal government, with the president already issuing executive orders freezing hiring and already-accepted job offers and recalling remote workers to the office to prompt further cuts.
The federal government employs more than 2 million civilians who live and work in every U.S. state and territory, including Kentucky.
How many federal workers does Kentucky have?
According to data from the Congressional Research Service, Kentucky has a total of 23,118 federal civilian workers as of Dec. 20, 2024. That figure does not include federal contractors or uniformed military personnel, including those who work at Fort Knox or Fort Campbell, for example.
In Kentucky’s 6th Congressional District, which includes Fayette, Madison and several neighboring counties, the CRS estimates there are 9,762 federal civilian workers, making up 2.55% of all workers in the district.
What impact would reductions in the federal workforce have on KY?
Opinions are mixed on the exact impact federal jobs cuts could have on Kentucky’s economy.
Jason Bailey, executive director of the Kentucky Center for Economic Policy, calls the U.S. government one of Kentucky’s major employers, with workers offering critical services.
“This fact is little known, but it means that a cut in federal jobs will weaken our economy. It will also diminish critical services, as these workers do everything from supporting farmers to providing healthcare to veterans to helping retirees get their social security checks,” Bailey told the Herald-Leader in an emailed statement.
On the other hand, some economists see a minimal effect on the state’s economy as a whole.
Mike Clark is the director of the Center for Business and Economic Research and an associate professor at the University of Kentucky. Previously, he was the chief economist for the Kentucky Legislative Research Commission.
With the caveat that it’s unclear at this point how much the Trump administration wants to shrink the size of the federal government, Clark told the Herald-Leader in a Feb. 5 interview the effect on Kentucky’s economy should be minimal.
“It’s relatively small in terms of the grand scheme of the economy… If they’re talking about half or getting rid of all of them, then that is certainly a larger impact, but if it’s 10, 20%, then it’s going to be a relatively small number,” Clark said.
“It’s important for those particular workers who are dependent on those jobs and those wages, but in terms of the overall size of the economy, it’s likely to be a relatively small impact,” he added.
“Right now, the economy seems to be doing fairly well… If they were to lose these jobs, they’re at least doing that in a time period where the economy is actually doing well. So hopefully there are options,” Clark said.
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This story was originally published February 6, 2025 at 5:30 AM.