The next federal worker losing their job could be your neighbor, even if you don't live anywhere near the US capital.
While the District of Columbia, Maryland, and Virginia are home to the largest numbers of federal workers, many other cities in both Republican and Democratic congressional districts have large shares of their workforce in federal jobs.
About 23% of the 1.97 million federal civilian workers are located in D.C., Maryland, and Virginia. The remaining live in the rest of the US and its territories, according to a December report from the Congressional Research Service.
These workers can account for up to 5% to 7% of a congressional district's total employment, according to the CRS, a major contributor to the economy of many cities and towns, big and small, from the East Coast to the West plus many in between.
They work on military bases and in national parks, for the Internal Revenue Service, and other agencies across the federal government.
One of President Donald Trump's big goals for his second term is to reduce the number of federal workers. To do this, the administration has offered so-called "buyout" packages that about 75,000 workers took. This week, the White House embarked on mass layoffs targeting some 200,000 employees who have been in their current positions for less than a year and have fewer worker protections. Other efforts may be on the way.
Depending on how many layoffs each community absorbs, the ripple effects could create a significant drag on local economies, making them more vulnerable to any national slowdown.
"The federal government expenditures are an automatic stabilizer to the economy," said Donna Ginther, director of policy and social research at the University of Kansas. "And so when you reduce the federal footprint, both in terms of the amount of money flowing into the state and local economies and employment, you're adding more instability to the economy."
People rally at Health and Human Services headquarters to protest the polices of President Donald Trump and Elon Musk Wednesday, Feb. 19, 2025, in Washington. (AP Photo/John McDonnell) ·ASSOCIATED PRESS
‘A dampening effect’
Some of the congressional districts that have the highest share of federal workers are home to military bases that each employ hundreds, even thousands, of civilian workers who support the base operations.
Take Colorado District 5, which encompasses Colorado Springs and several large military installations — Fort Carson, a large Army base; Peterson and Schriever Space Force Bases, and the US Air Force Academy.
Federal employees make up 6% of the district's total workforce, per the CRS report. In the Colorado Springs region, there are about 13,000 civilian federal workers, according to Tatiana Bailey, executive director of Data-Driven Economic Strategies in Colorado Springs.
"Definitely higher than the national average," she said. "Those individuals are typically decently paid. If they're not employed, they're not spending as freely as they normally would. This has a dampening effect."
There have yet to be reports indicating local layoffs, but Government Executive, a daily news site that tracks the goings-on of the federal government, reported that defense leaders received directives on Monday to plan for probationary employee firings. Additionally, Defense Secretary Pete Hegseth this week directed the military to cut $50 billion, or about 8% of its budget, next year.
"I can imagine [our local bases] are concerned and bracing for an impact," said Bill Craighead, program director at the University of Colorado, Colorado Springs Economic Forum. He noted the city also has many defense contractors that "potentially could absorb some terminated civilian employees from our military installations."
"However, their contracts also could potentially be impacted by some of these 'efficiency' efforts," he said.
Grand Canyon, Arizona USA (Photo by Harald Lange\ullstein bild via Getty Images) ·ullstein bild via Getty Images
So far, the Department of Interior, which includes the National Park Service, has laid off 2,300 employees, according to documents obtained by Government Executive.
For some areas, parks are a big moneymaker, such as North Carolina's District 3, where federal workers make up 6.51% of its workforce. The very red district encompasses the bulk of the Outer Banks region and is home to four national parks: Cape Hatteras National Seashore, Fort Raleigh National Historic Site, Wright Brothers National Memorial, and Cape Lookout National Seashore.
In 2023, visitors to the four parks spent an estimated $716.7 million, supporting 11,204 jobs in the area and generating $955.5 million in economic output in the district, according to the National Park Service. Spokespeople for the parks declined to say whether layoffs affected their personnel.
Meanwhile in Flagstaff, Arizona, home to Arizona District 2 where federal employees make up 5% of the workforce, a protest erupted over the layoffs at nearby Grand Canyon National Park, which generated $1 billion in economic output in 2023 and supported 10,100 jobs in the area.
Jim Landahl, who was among those laid off at the park, told a local news outlet that the firings "sent a shockwave through the town itself ... so we're all banding together, and we all are sticking up for our little town."
Some of the deepest layoffs this week hit the Internal Revenue Service, with reportedly 6,700 tax employees set to get axed. That could hurt major IRS hubs like Ogden, Utah, and Kansas City metro.
In Ogden, there are anywhere between 7,000 and 10,000 IRS employees depending on the time of year, plus more federal workers employed at nearby Hill Air Force Base. Overall, federal workers make up 5.92% of the total workforce in the congressional district where Ogden is located, providing "a great foundation for the overall economy," said Andrew Keinsley, associate professor of economics at Weber State University in Ogden.
Tax Examiners work at the Internal Revenue Service's facility on March 31, 2022, in Ogden, Utah. (Photo by Alex Goodlett for The Washington Post via Getty Images) ·The Washington Post via Getty Images
Fortunately, the Ogden economy has diversified over the past decade, he said. Other large employers include a large hospital, the university, and major manufacturing facilities. Tourism has also grown, buoyed by the popular ski destinations of Snowbasin Resort and Powder Mountain nearby.
In fact, the Milken Institute recently ranked Ogden as the second best-performing city in the country, so Mike McBride, director of Ogden City communications, hopes the robust local economy could absorb any blows from IRS layoffs.
"We care about these families. They own homes in our community and their children are in our schools," McBride said. "We will do what we can to find stable employment for those laid off."
That may be harder to do in the Kansas City metropolitan area depending on the depths of the cuts, said Ginther. The federal government employs about 30,000 people in the metro area, with over half at the IRS.
If the Trump administration reduces the federal workforce by 10% — one of the benchmarks being batted around — that would be 3,000 workers in Kansas City metro.
"But when I looked at [local] job postings for people with a bachelor's degree or higher, there are only 2,800 jobs currently available," Ginther said. "So as of today, it does not appear that the Kansas City metro economy could absorb those job losses."
That's not all. Ginther noted that estimates out of the Mid-America Regional Council found that if 3,000 federal jobs were lost in the metro area, that would translate to about 6,000 jobs lost over time.
“These are relatively good-paying jobs, right? And so you lose your job, your consumption stops until you can get a new job," Ginther said. "That has a spillover effect."
"It doesn't happen all at once, but over time, you will see a significant slowdown in economic activity in the region."
Janna Herron is a Senior Columnist at Yahoo Finance. Follow her on X @JannaHerron.
