2025 was a year unlike any other for the federal workforce. From historic disruptions to sweeping policy changes, federal employees navigated uncertainty, shifting expectations, and moments of unexpected generosity with remarkable resilience.
Before we dive into the top stories of the year, I want to pause and extend my deepest gratitude to you — our readers. Your continued engagement, your curiosity, and your commitment to staying informed are what make this online community meaningful. Whether you read every article, check in during major developments, or share our content with colleagues, your support is the reason we’re able to do this work. Thank you for your continued support and allowing us to provide this service to the federal community.
I also want to express my sincere appreciation to the authors who generously share their knowledge and expertise with the federal community through their articles. They help to make the wide variety of content that you read on the FedSmith website possible through their willingness to break down complex issues, offer perspective, and help federal employees better understand important news and information that impact them. When you read articles that you find helpful, please consider taking a moment to let the authors know.
2025 was an unusually eventful year for the federal workforce, and I have picked some of the events that I felt were the most noteworthy which are outlined below. Please feel free to share others from the past year in the comments that you feel are significant.
Longest Government Shutdown in U.S. History
Federal employees had to contend with a government shutdown in 2025 that set a new record for the longest ever in the country’s history when a dispute in Congress arose over extensions of enhanced Obamacare subsidies. Since the concept of government shutdowns arose under the Carter administration, there have been several over the years, but the one in 2025 lasted 43 days, breaking the previous record of 35 days.
Deferred Resignation Program
Shortly after the Trump administration took office in January 2025, FedSmith published an article titled Is There a Buyout in Your Future and Will You Take It? which predicted that buyout offers would likely be coming soon for the federal workforce based on the administration’s goals and first actions after taking office, such as enacting a hiring freeze and reinstating Schedule F.
What had not been predicted was just how quickly a buyout offer would be put on the table. The day after that article was published, a formal offer went out to most of the federal workforce. It was called the Deferred Resignation Program and was announced via OPM’s fork in the road email.
This email said that a reformed federal workforce would be built around four pillars:
- Return to office – Most federal employees would be required to return to in-person work
- Performance based culture – The federal workforce will be comprised of the best, with updated performance standards rewarding excellence and addressing underperformance
- More streamlined federal workforce – Most federal agencies will likely downsize through restructuring, realignments, and reductions in force, including furloughs and reclassification to at-will status
- Enhanced standards of conduct – Federal employees must be reliable, loyal, trustworthy, and strive for excellence, and unlawful behavior or misconduct would result in investigation and discipline, including termination
The offer allowed federal employees to resign immediately and collect full pay and benefits through the end of the fiscal year (September 30, 2025). According to OPM, approximately 154,000 federal employees left the government voluntarily under the program.
Reduction of the Federal Workforce
The combination of the Deferred Resignation Program along with RIFs led to a substantial reduction of the overall federal workforce in 2025.
OPM Director Scott Kupor wrote in a recent blog post that the federal government hired roughly 68,000 people in 2025 and approximately 317,000 employees left, going from roughly 2.4 million total federal employees to 2.1 million.
According to OPM, hiring was limited in 2025 to only mission critical roles which “ensured government resources are focused on core statutory responsibilities and administration priorities, not bureaucratic expansion.”
The collective efforts to cut the size of the federal workforce led to an unusually large increase in the backlog of retirement claims at the Office of Personnel Management (OPM). It went from just over 23,000 in January 2025 to 48,396 at the end of November 2025.
Launch of Online Retirement Application System
Because of the antiquated retirement applications process, OPM has been working on creating a modern, digital system to speed up the process which launched over the summer. Data about the number of digital versus paper applications began being published in October.
OPM said that the new system will be faster and better meet the needs of federal employees. The data are promising so far, but it is too early in the process to determine its ultimate impact on reducing the OPM retirement backlog.
Reducing Telework
The day he took office, President Trump signed a memo that directed agencies to “take all necessary steps to terminate remote work arrangements and require employees to return to work in-person at their respective duty stations on a full-time basis…”
This was always a controversial topic and one that became politically divisive. Under the Biden administration, the use of telework in government grew significantly but the Trump administration vowed to scale it back upon returning to Washington. Federal employee unions also favored telework and remote work and have fought the Trump administration’s efforts to reduce their use.
According to data published by Gallup in September, the Trump administration’s efforts to reduce telework and remote work were having their intended effect with the numbers of federal employees in the Washington, DC area working in agency offices being triple the amount they were in the first quarter of 2022.
Restrictions on Collective Bargaining
Another one of President Trump’s objectives in his second term has been to increase restrictions on federal employee unions and limit their influence.
One of the most prominent examples of this in 2025 was when he issued two executive orders significantly expanding the number of agencies restricted from collective bargaining based on national security concerns, the most recent of which came in August.
Federal employee unions have been fighting the administration in court every step of the way, and the most significant restrictions are likely to reach the Supreme Court.
A First in History: Two Extra Christmas Holidays
President Trump gave federal employees not one, but two additional paid holidays for Christmas this year: Christmas Eve and the day after Christmas. It was not a surprise to see the day after Christmas since that fell on a Friday this year, but it was especially significant because a president has never given two full days off to the federal workforce for Christmas.
2025 and 2026 Federal Pay Raises
The pay raise for the coming year is always finalized in December, so federal employees found out what their pay raise would be in 2026 at the same time they got the extra vacation time at Christmas since both were announced simultaneously.
The 2026 federal pay raise is a 1% average raise for most federal employees with no increase for locality pay. Some federal employees in law enforcement will also get a 3.8% total pay increase to match the 2026 military pay raise.
In 2025, federal employees got an overall average 2% pay raise. Unlike 2026, it did include a small increase for locality pay averaging 0.3% (1.7% went to the base pay raise).
Be sure to check out the 2025 and 2026 General Schedule pay scales to see how they compare.
Happy new year! I wish you and your loved ones a happy, healthy and successful upcoming year in 2026.
May he grant your heart’s desires and make all your plans succeed. May we shout for joy when we hear of your victory and raise a victory banner in the name of our God. May the Lord answer all your prayers.
~ Psalms 20:4-5 (NLT)
