Workforce Cuts Come With a $9.5B Leave Bill

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Federal agencies paid an estimated $9.5 billion in 2025 to employees on paid administrative leave, most of it tied to a workforce-cut plan.

Story Snapshot

A Government Accountability Office estimate puts 2025 paid leave costs at $9.5 billion, a sixfold jump from 2023.
About $6.7 billion and roughly 70% of the 2025 total are linked to the Deferred Resignation Program.
Reported paid leave days surged to about 21.6 million in 2025, up from roughly 4–4.4 million in 2023–2024.
The Office of Personnel Management said the expense is a one‑time cost aimed at long‑term savings.

What GAO Found About Paid Leave Costs

The Government Accountability Office (GAO) estimated that agencies spent $9.5 billion on paid administrative leave in 2025. That total marked a sixfold increase from 2023 and a 435 percent rise across two years, according to multiple summaries of the report. GAO’s finding centers on salary costs paid to employees who were not working while on administrative leave. The increase tracked with a federal push to shrink the workforce, which changed how many workers were placed on leave while they exited.

GAO-linked reports say about $6.7 billion of the total tied to the Deferred Resignation Program, a 2025 effort that let employees resign on a later date while staying on paid leave until then. Outlets summarizing GAO’s data also reported that roughly 70 percent of all paid administrative leave in 2025 fell under this program. The volume of leave days rose sharply as well, from about 4 to 4.4 million days in 2023–2024 to roughly 21.6 million days in 2025.

How The Program Worked And Why It Grew

Coverage ties the surge to the Trump administration’s broader effort to reduce the federal workforce through the Department of Government Efficiency initiative. The Office of Personnel Management issued guidance that allowed agencies to place employees who accepted deferred resignation offers on administrative leave until their set exit dates. That policy choice meant many workers stopped reporting to the office while still on the payroll, which swelled paid leave totals as participation increased in 2025.

The Office of Personnel Management’s rules define administrative leave as paid time off that does not draw from sick or annual leave banks. The agency’s materials outline when and how agencies can use this tool and note limits for some cases. Separate guidance tied to the deferred resignation effort described how managers should code leave and process resignations set for September 30, 2025, which created a predictable window for higher leave use.

The Savings Claim And What Remains Unclear

Scott Kupper, director of the Office of Personnel Management, defended the 2025 spending as a one‑time cost that would be offset by future savings from a smaller government. He cited projected annual taxpayer savings of about $40 billion as the workforce shrinks and payroll costs fall. GAO’s summaries, however, stressed that the $9.5 billion number is an estimate. Reports also say the Office of Personnel Management does not track the full, exact costs across agencies.

For taxpayers, the tension is simple. A large bill came due in 2025 to move people out of government service. Supporters call it an investment that cuts recurring costs. Critics see it as proof of waste and poor planning. Many Americans on the left and right worry that leaders talk about savings but hide the price to get there. This episode shows how internal rules can shift big sums without a clean paper trail, which feeds broader doubts about federal management.