Bay Area hit hard by federal job cuts

As the Trump administration pursued a massive downsizing this year, the Bay Area lost more federal jobs than any other part of California, according to seasonally adjusted numbers compiled by Beacon Economics and the state Employment Development Department.

Over the first four months of the year, California lost 1,200 federal jobs, data shows. Of those losses, the Bay Area accounted for 600 of the cuts — adding to the region’s continuing job woes.

“Most people don’t realize the federal government is a major employer and job driver,” said Russell Hancock, president of San Jose-based think tank Joint Venture Silicon Valley.

The Bay Area lost federal jobs this year at a pace that was nearly three times that of the state as a whole, and nearly twice the federal government’s employment decline nationwide.

Federal totals dropped 1.4% in the region in 2025 compared to a decline of 0.5% in California and 0.8% nationwide.

The East Bay led the nine-county region with 300 federal job cuts in 2025 for a decline of 2.3%. The San Francisco-San Mateo metro area shed 200 federal positions, representing a 1.4% decline, and the South Bay had no change in its totals.

Overall, the U.S. government eliminated 23,000 federal jobs nationwide this year.

The cuts in the Bay Area arrive at a time when the job markets in both the state and region have floundered.

“The loss of federal jobs creates another headwind for the region as it attempts to sustain some positive momentum on overall employment,” said Jeff Bellisario, executive director of the Bay Area Council Economic Institute.

The Bay Area lost 14,700 total nonfarm payroll jobs in all categories over the first four months of 2025. Over the same time, California lost 32,300 total payroll jobs, official reports from the state Employment Development Department show.

“There is little doubt that federal government job losses will be an important contributor to the labor market malaise that already appears to be falling over the Bay Area,” said Scott Anderson, chief economist with BMO Capital Markets.

In sharp contrast, state and local government agencies have increased hiring, but that may soon change.

“We’re likely to see job declines in state and local governments beginning in July with the new fiscal year, and possibly before,” said Michael Bernick, an employment attorney with law firm Duane Morris and a former director of the state EDD.

He said some local and state agencies are not filling vacant positions.

The increases occurred despite frequent warnings that belt-tightening and layoffs loom as California and local public agency officials warn about budget shortfalls.

“Continued government job gains at the state and local level in the Bay Area are more than making up for the loss of federal jobs in the region,” Anderson said. “There will be more belt-tightening ahead. State and local governments don’t have the same luxury of papering over their budget shortfalls with massive borrowing.”

In addition, state and local government agencies have yet to feel the effects of cutbacks from federal programs whose dollars might support a certain level of staffing, some experts warn.

“The gains in state and local government jobs are likely temporary,” said Steve Levy, director of the Palo Alto-based Center for Continuing Study of the California Economy. “Slower economic growth and federal grant cuts will hit budgets in the Bay Area, the state and the nation.”

In the U.S., federal employment reached what appeared to be an all-time high of roughly 3.015 million jobs in January. But starting in February, that number decreased for three consecutive months as President Donald Trump and tech billionaire Elon Musk attempted to trim the federal workforce.

“Firing huge numbers of federal employees won’t decrease the need for government services,” Everett Kelley, president of the American Federation of Government Employees, the nation’s largest union that represents federal workers, said in February. “It will just make those services harder or impossible to access.”

Reports from the Bureau of Labor Statistics show that federal job cuts in the Washington, D.C., metro area were at a significantly greater pace than the nation as a whole.

According to an assessment of employment totals posted by the U.S. Bureau of Labor Statistics, Washington, D.C., shed 3,300 federal government jobs in 2025. Similarly, Virginia lost 5,100 positions, a decline of 2.6%, while Maryland shed 5,300, a drop of 3.3%.

Job losses within the federal government could become far worse in the months ahead, some experts warn.

“These numbers are the tip of the iceberg,” Levy said. “The majority of federal job cuts are not reflected in the April data.”

The federal employee separation and downsizing procedures are among the reasons behind the relatively modest job losses.

“A good number of federal workers whose jobs are being eliminated are formally still on administrative leave,” Bernick said. “We should see the federal job cuts more fully reflected in the national and state monthly jobs reports in the next few months.”