Day: October 5, 2025

• White House economic advisor Kevin Hassett says federal workers could be laid off amid the shutdown.
• The government shut down last week after lawmakers failed to agree on a funding measure.
• He said lawmakers are still “hopeful” of reaching an agreement.

Federal workers could face layoffs if Republican and Democratic lawmakers can’t make headway on talks to end the government shutdown, a top White House economic advisor said Sunday.

“I think that if the President decides that the negotiations are absolutely going nowhere, then there will start to be layoffs,” Kevin Hassett, director of the National Economic Council, said on CNN’s “State of the Union.”

The shutdown began on October 1 after lawmakers failed to reach an agreement on a plan to fund the federal government beyond September 30. Although Republicans control both chambers of Congress, the funding bill requires 60 votes in the Senate, so some Democrats will need to cross party lines.

The core of the disagreement is over expiring tax credits that make health insurance more affordable for millions of Americans. Democrats also want to reverse cuts to Medicaid made by the Trump administration in July.

The Office of Management and Budget sent a memo to agency heads before the shutdown directing them to “consider” reduction-in-force notices for employees in programs that are “not consistent with the President’s priorities” and that will lose funding if the government shuts down.

The memo did not indicate how many workers it is targeting through the reduction-in-force directive. When asked by reporters about the scale of the firings last week, President Donald Trump said that the administration “may do a lot.”

In an automated email response, the White House press office said that due to staff shortages, it was unable to respond to requests for comments in a “timely manner,” adding that “this could have been avoided if the Democrats voted for the clean Continuing Resolution to keep the government open.”

While nearly a third of the 750,000-strong federal workforce has stopped work amid the shutdown, Business Insider’s Bryan Metzger reported that none of the 45 Department of Government Efficiency staffers were furloughed.

Hassett said Sunday that officials are hopeful lawmakers can reach a resolution.

“I think everyone is still hopeful that when we get a fresh start at the beginning of the week, we can get the Democrats to see that it’s just common sense to avoid layoffs like that,” Hassett said.