White House warns of mass layoffs as US shutdown standoff deepens

WorldView · Tania Wanjiku · October 2, 2025
White House warns of mass layoffs as US shutdown standoff deepens
The North Lawn of the White House in Washington, DC, on November 18, 2022. PHOTO/AFP/Getty Images
In Summary

A vote to reopen the government collapsed just hours after the shutdown took effect, and the Senate later adjourned without a deal, increasing fears of a prolonged standoff that could cost the economy billions and put hundreds of thousands of jobs at risk.

The White House has warned that mass layoffs of federal workers will start within two days as the United States government shutdown enters its first days with no sign of compromise between Republicans and Democrats.

The shutdown began at midnight on Wednesday after both sides in Congress failed to pass a new spending plan, marking the first government closure in nearly seven years.

A vote to reopen the government collapsed just hours after the shutdown took effect, and the Senate later adjourned without a deal, increasing fears of a prolonged standoff that could cost the economy billions and put hundreds of thousands of jobs at risk.

Vice-President JD Vance appeared alongside Press Secretary Karoline Leavitt at a White House briefing, where they placed the blame on Democrats. “If they are so worried about the effect this is having on the American people, and they should be, what they should do is reopen the government, not complain about how we respond,“ Vance said.

Leavitt said the administration would begin implementing mass job cuts within two days. "Sometimes you have to do things that you don't want to do," she said, adding that "Democrats put us in this position".

The remarks came amid sharp exchanges between both parties. Senate Democratic leader Chuck Schumer had earlier accused Republicans of trying to "bully" Democrats into accepting their preferred funding plan.

Democrats want firm commitments on healthcare funding before agreeing to a budget, while Republicans are pushing for a short-term stop-gap measure to keep government operations running at current funding levels until mid-November.

Democrats argue that allowing the shutdown is part of their strategy to protect healthcare support for lower-income Americans, insisting that talks with Republicans on the issue have not made progress.

“Why are they boycotting negotiations? I've never witnessed this in my life," said Senator Chris Murphy of Connecticut. “The matter is the government will open when Republicans get serious about it talking to Democrats.”

Republicans, who control both chambers but lack the 60 votes needed to pass a funding bill, say healthcare extensions are not their priority.

They argue that keeping the government open should come first. "It's not about who wins or who loses or who gets blamed and all this,” Senate Majority Leader John Thune said.

“It's about the American people. And [Democrats] have taken the American people hostage in a way that they think benefits them politically."

They have also criticised the healthcare provisions sought by Democrats, saying the Covid-era benefits are costly and no longer necessary.

Essential workers, including border officers and military personnel, will continue working without pay for now, while non-essential staff are being sent home without pay but could be compensated later, as has happened in past shutdowns.

Analysts expect this closure to affect more workers than the 2018 shutdown, with an estimated 40 percent of the federal workforce — about 750,000 employees — likely to be placed on temporary leave. Some furloughs have already started.

The administration has also warned of possible permanent job cuts if the stalemate continues. "Let's be honest, if this thing drags on," Vance said during the briefing, "we are going to have to lay people off."

He also claimed that Democrats want to extend healthcare benefits to undocumented migrants, a statement they have strongly rejected. US law bars undocumented migrants from accessing federally funded healthcare.

“Nowhere have Democrats suggested that we're interested in changing federal law," House Minority Leader Hakeem Jeffries said.

Russell Vought, the White House budget director, privately briefed Republican lawmakers on how the layoffs could unfold, though few details have been made public. On Capitol Hill, there was little sign of movement.

"There's nothing to negotiate. There's nothing we can pull out of this bill to make it any leaner or cleaner than it is," House Speaker Mike Johnson said. Another vote on the short-term funding proposal by Republicans is expected on Friday.

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