How Federal Employee Layoffs Will Impact State Unemployment Rates
With plans to make drastic cuts to the federal labor force underway, the impact on unemployment rates will vary significantly from state to state. Using the most current data from the Office of Personnel Management (OPM) and the Bureau of Labor Statistics (BLS), we can look at different scenarios. The chart below shows how unemployment rates would increase for the ten most affected states if 20% or 50% of the federal workforce in the state was laid off.
As expected, Washington, D.C. would be the most impacted by federal worker layoffs, with its unmployment rate skyrocketing in either scenario. Maryland and Virginia would also be significantly impacted, given that many federal workers are located in those states. Maybe surprisingly, states like Hawaii and Alaska would also see significant increases in their unemployment rates.
The table below shows how unemployment rates could be impacted for all fifty states and the District of Columbia:
| State | Current Rate | 20% Scenario | 50% Scenario |
|---|---|---|---|
| Alabama | 3.2% | 3.5% | 4.1% |
| Alaska | 4.7% | 5.3% | 6.2% |
| Arizona | 3.5% | 3.7% | 4.0% |
| Arkansas | 3.4% | 3.6% | 3.9% |
| California | 5.2% | 5.3% | 5.6% |
| Colorado | 4.5% | 4.8% | 5.2% |
| Connecticut | 2.7% | 2.8% | 2.8% |
| Delaware | 3.2% | 3.3% | 3.6% |
| District of Columbia | 5.0% | 12.9% | 24.8% |
| Florida | 3.1% | 3.3% | 3.5% |
| Georgia | 3.4% | 3.7% | 4.1% |
| Hawaii | 2.8% | 3.5% | 4.6% |
| Idaho | 3.7% | 3.9% | 4.2% |
| Illinois | 4.3% | 4.4% | 4.6% |
| Indiana | 4.0% | 4.2% | 4.4% |
| Iowa | 3.0% | 3.1% | 3.3% |
| Kansas | 3.3% | 3.6% | 3.9% |
| Kentucky | 5.1% | 5.3% | 5.6% |
| Louisiana | 4.1% | 4.3% | 4.6% |
| Maine | 3.6% | 3.9% | 4.4% |
| Maryland | 2.7% | 3.6% | 5.0% |
| Massachusetts | 4.2% | 4.3% | 4.5% |
| Michigan | 5.0% | 5.1% | 5.3% |
| Minnesota | 2.7% | 2.8% | 2.9% |
| Mississippi | 3.5% | 3.8% | 4.3% |
| Missouri | 3.2% | 3.4% | 3.8% |
| Montana | 3.0% | 3.3% | 3.9% |
| Nebraska | 2.6% | 2.8% | 3.1% |
| Nevada | 5.6% | 5.8% | 6.0% |
| New Hampshire | 2.7% | 2.9% | 3.1% |
| New Jersey | 4.2% | 4.3% | 4.4% |
| New Mexico | 3.9% | 4.3% | 5.0% |
| New York | 4.1% | 4.3% | 4.4% |
| North Carolina | 3.4% | 3.6% | 3.9% |
| North Dakota | 2.5% | 2.7% | 3.1% |
| Ohio | 4.2% | 4.4% | 4.7% |
| Oklahoma | 3.0% | 3.4% | 4.0% |
| Oregon | 4.3% | 4.4% | 4.7% |
| Pennsylvania | 3.3% | 3.6% | 3.9% |
| Rhode Island | 4.2% | 4.5% | 5.0% |
| South Carolina | 4.0% | 4.2% | 4.5% |
| South Dakota | 2.0% | 2.3% | 2.9% |
| Tennessee | 3.5% | 3.7% | 4.0% |
| Texas | 3.7% | 3.9% | 4.1% |
| Utah | 2.9% | 3.3% | 3.9% |
| Vermont | 2.5% | 2.7% | 3.0% |
| Virginia | 2.5% | 3.2% | 4.1% |
| Washington | 4.3% | 4.6% | 5.0% |
| West Virginia | 3.6% | 4.0% | 4.7% |
| Wisconsin | 2.9% | 3.0% | 3.1% |
| Wyoming | 3.7% | 4.1% | 4.7% |
About the Data
The OPM FedScope Employment Cube provides detailed data on federal employment, including the number and distribution of federal civilian employees across different agencies, locations, and job categories. It's maintained by the U.S. Office of Personnel Management (OPM) and serves as a comprehensive source for federal workforce statistics.
The BLS LAUS (Local Area Unemployment Statistics) data is a program by the Bureau of Labor Statistics that provides monthly estimates of employment and unemployment for approximately 7,300 areas, including states, counties, metropolitan areas, and cities. This data helps track local labor market conditions and is essential for understanding regional economic trends, policy planning, and the distribution of federal funds.