Trump wants the private sector to absorb displaced federal workers. Easier said than done.

If fired federal workers aren’t already living their worst nightmare, the labor market they’re entering may soon make that their reality.

Some 75,000 workers accepted the Trump administration’s deferred resignation offer, and thousands more have been laid off amid the president’s attempts to slash the federal workforce.

While most federal agencies have refused to disclose who accepted the offer, workers entering the labor market will likely have a harder time finding “higher productivity” private-sector jobs than the administration and DOGE, unofficially overseen by Elon Musk, may have led them to believe. Many private-sector companies have slowed hiring, particularly for highly educated, white-collar workers, who make up the bulk of the federal workforce.

Those hiring, however, may have an opportunity to fill in-demand roles, experts told HR Brew.

Location dependent. It’s unlikely the mass exodus of federal workers will significantly impact the overall labor market.

“From my past experience and watching large company layoffs, this is very similar to that—things tend to happen in a trickle,” Ron Hetrick, VP of staffing strategy and senior labor economist at labor market insights firm Lightcast, told HR Brew.

Workers who took buyouts were likely close to retirement or had another opportunity lined up, he added. “I really don’t think you’re going to get a jarring of our unemployment rate, or recruiters, all of a sudden, going to be, like, ‘I got a ton of applicants.’”

That said, some locales will likely be hit harder than others. In the Washington, DC metro area, which accounts for the largest share (20%) of the federal workforce, for example, unemployment claims are already skyrocketing. Workers in search of a more affordable cost of living may leave the area, Hetrick said.

Other areas with high concentrations of federal workers and fewer comparable private-sector opportunities—like Kansas City, with its 30,000 federal workers—could be harder hit.

“A lot of those are in areas that have seen declining economic activity in the past 10 to 20 years, whether that’s due to globalization, manufacturing moving out, or different kinds of migration patterns,” Adam Stafford, CEO at recruitment marketing firm Recruitics, said. “I think some of the centers of population that we’re going to see come onto the market here from these resignations are going to be in areas where the government is a larger share of the employers in the area than maybe the national average would suggest.”

Entering a complex job market. How easily federal workers find private-sector employment may depend on where they set their sights, and their skillsets.

Businesses with federal contracts or public funding may see this as a chance to recruit workers who were on the other side of those programs. Similarly, those in need of workers with a security clearance—who can be difficult to recruit for, in part because employers that deal with national security matters can’t disclose to candidates without clearance what they’d work on—may also see this as an opportunity.

“With new talent coming out of the government that’s already cleared, I don't know if it’s going to be a groundswell of close rates in terms of bringing that talent onto projects, but we should see an influx, a faster influx of talent and a lower overall cost,” Stafford said.

However, some of the most popular fields for federal workers—including budgeting and accounting—have seen sluggish private-sector job growth.

“There are a lot of financial analyst types of jobs in the government. We have an economy right now that’s not exactly starving for financial analysts, so you’re facing a bit of an uphill battle there,” Hetrick said.

While certain analyst jobs are expected to grow, the hard skills required to perform them may not translate to the private sector, due to differences unlike the technology systems that federal workers used may be harder to adapt to private sector jobs. Other common occupations, like clerical roles, face obsolescence.

“A lot of that work is work that is highly susceptible to offshoring and highly susceptible to automation, and so those workers may have a little bit tougher time now,” Stafford said.

Recruiting rethink. Employers will have to rethink how skills translate.

“Employers need to understand that there's incredibly bright people who work for the government and really let them have a chance to show you what their body of work was, and what they were doing,” Hetrick said.

Recruiters should see this as an opportunity to tap workers in industries who may overlook their business. CVS, for example, has, in addition to its retail and pharmacy business, an insurance division and has received federal contracts.

“When you look actuarial sciences and mathematicians coming out of the federal government, that could be a very interesting role for somebody who [is]...coming into the private sector,” Stafford said. “The very first thing to do is simply raise awareness that, as an employer, we’re looking for people like you.”