Colorado Politics

Colorado Springs could feel outsized hit from federal workforce exodus

President Donald Trump’s moves to slash the federal workforce could have a disproportionate impact in El Paso County, where the population of civilian government employees is almost double the national average.

As questions about how the epic downsizing continue to swirl — around water coolers, and in the courts — economic and labor experts say local demographics put the region at the forefront of the administration’s cost-cutting overhaul, which aims to hew 10% from the federal workforce.

“The federal government is more important for our local economy than it is nationally, so changes with the federal government have a bigger impact here than they do for the U.S. economy overall,” said Bill Craighead, program director for the University of Colorado Colorado Springs Economic Forum, a community resource for data and analysis.

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As of Friday, terminations and buyout offers had led to the exodus of more than 75,000 civilian government employees, according to reporting by The Associated Press.

How many federal employees in Colorado and Colorado Springs were eligible for, and took the government up on, its offer is unknown.

Approximately 2.28 million civilians were employed by the federal government in 2024, according to a study by the Office of Management and Budget.

Statewide, Colorado was home to almost 40,000 civilian government employees, according to a 2024 report from the Congressional Research Service. As of December, almost one-third of them — 12,900 people — lived in the Colorado Springs metropolitan statistical area, according to the Bureau of Labor Statistics.

Such residents represented 3.8% of the area’s total civilian payrolls, or “double the national share” of 1.9%, Craighead said.

Republican U.S. Rep. Jeff Crank, who represents the El Paso County-based 5th Congressional District, said he has “faith” that the executive mandates are clearing the way for a “more efficient and effective government.”

“President Trump is following through on his commitment to root out waste, fraud and abuse across the federal government. While the President’s process is in its early stages, I am closely monitoring the impacts to Coloradans,” he said in an emailed statement to The Gazette.

Trump’s initial attempt to downsize the workforce was the deferred resignation program, commonly described as a buyout, which offered to pay people until Sept. 30 if they agreed to quit. A federal judge cleared a legal roadblock for the program Wednesday, but The White House said the number of workers who took the offer was less than the administration’s target. Trump has made it clear he would take further steps.

Layoffs began last week.

On Thursday, the U.S. Forest Service announced it would fire about 3,400 probationary employees, part of a week-long purge of some 10,000 workers whose comparatively brief tenures make ties easier to sever.

That same day, the Department of Veterans Affairs announced it had fired more than 1,000 employees, representing about 2.3% of the department’s probationary workforce.

Cuts to probationary staff are estimated to save close to $100 million annually, with money redirected back into “health care, benefits and services for VA beneficiaries,” according to a news release from the department.

Employees at the National Science Foundation and Housing and Urban Development Department were told that large reductions, in some cases a halving of the workforce, would be coming, according to a person familiar with the situation who spoke on condition of anonymity because they were not authorized to discuss it.

As of early February, among the federal employees to receive a “Fork in the Road” email were Defense Health Agency employees who work on military bases in Colorado Springs. One of the largest employers locally within the DHA is Evans Army Community Hospital on Fort Carson, with 2,300 military service members and civilians.

The offers to resign also went out to employees who work on public lands, such as the Forest Service, National Parks Service and Bureau of Land Management.

The offer was available to most people who received the letter, though not to employees whose positions are deemed essential. The government has not yet clarified which positions are essential and outside the scope of downsizing.

“The magnitude of the possible impact is very unclear right now, particularly since some of the administration’s actions are being challenged in court,” Craighead.

The uncertainty alone can lead to real-world impacts, for affected individuals and the local industries their incomes help support.

“I expect there are people who are feeling more insecure about their jobs right now; it would be very natural for them to be pulling back on their spending,” Craighead said.

Federal employees who may not have had any intention of leaving their jobs likely made the decision, under an initial, breathless timeline, in order to avoid uncertainty further down the road, suggested the Springs’ Tatiana Bailey, executive director of the nonprofit Data-Driven Economic Strategies and former director of the UCCS Economic Forum.

Bailey worries that the highest-skilled expendable employees may leave federal work for higher-paying civilian jobs, never to return.

Vital resource agencies already considered to be understaffed could be hamstrung even further. Go-to resources for data and economic specialists such as herself — namely the Bureau of Economic Analysis and the Bureau of Labor Statistics, both government agencies staffed by civilian federal employees — could lose the core of their brain trusts.

Employees of both agencies were among those to receive buyout offers.

Even though those agencies are based elsewhere and don’t directly impact local jobs, they support local workers and local stability. Reliable data will be especially critical as the nation sets out to navigate uncharted, bureaucratically leaner waters that lie ahead, Bailey said.

“Fourteen cents out of every $1,000 in the U.S. budget in 2023 went towards those two critical agencies that give us things like the unemployment rate and our GDP growth rates and all kinds of critical data,” Bailey said. “I think 14 cents of every $1,000 is well worth it. I don’t think that eliminating those positions is really making an appreciable difference in the federal deficit, the lion’s share of which is attributable to the cost of Social Security and Medicare.”

The Associated Press and The Gazette’s Mary Shinn contributed to this report.

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