HousingWireHousingWire
The purge of staffers within the federal government is beginning to show up in employment data.
The February jobs report released Friday by the U.S. Bureau of Labor Statistics revealed that federal employment dropped by 10,000, suggesting that the recent cuts from Elon Musk and the U.S. DOGE Service are starting to make an impact on a broader scale.
Overall, the U.S. economy added 151,000 jobs in February, which is slightly lower than expectations but an improvement from the downwardly revised figure of 125,000 jobs in January. Unemployment ticked up 10 basis points to 4.1%.
“Despite the solid report, we may be at the beginning of a weakening labor market,” Bright MLS chief economist Lisa Sturtevant said in a statement. “The latest data released by the Conference Board indicated that consumer confidence fell sharply in February, with consumers growing more anxious about overall economic conditions.
“Furthermore, weekly initial jobless claims data, which reflects claims for uninsurance among private sector workers are up slightly.”
The DOGE-induced layoffs only showed up in the data at the end of the month, which suggests that their full impact has yet to set in. The turmoil within the federal government has ignited fears of negative impacts to the housing market in Washington, D.C., but so far, it’s inconclusive how they deep they’ll go.
According to data from Altos Research, new listings in D.C. are in line with previous years, with 502 single-family homes and 457 condominiums hitting the market during the week of Feb. 28. Any rise in new listings resulting from federal jobless claims will also be hard to parse into the impact of falling mortgage rates, which currently sit at 6.82% for a 30-year fixed loan, according to HousingWire‘s Mortgage Rates Center.
The wide latitude that President Donald Trump has given Musk over staffing decisions within the federal government has hit the Department of Housing and Urban Development (HUD) and the Consumer Financial Protection Bureau (CFPB) particularly hard.
Given the breakneck speed with which employees have lost their jobs, it’s hard to know specific cuts at these agencies, but in mid-February, HUD reportedly planned to cut half of department staff, and Jonathan McKernan, the nominee for CFPB director, could follow through on plans to create a bare-bones bureau.
The Federal Reserve will consider cuts to interest rates in the run-up to its March meeting, but with little movement in the jobs report, it’s more likely that the Fed leaves rates unchanged.
“If the labor data gets softer going out in the future, what happens when we get to that 4.3% unemployment rate?” HousingWire Lead Analyst Logan Mohtashami asked. “The Fed probably wants wage growth back down to 3% if they really want 2% inflation.”
