The president of the American federal reserve, Jerome Powell, leaves after held a press conference after a two-day meeting of the Federal Committee of the Open Market Policy in Washington, DC, United States, May 7, 2025.
Kevin Lamarque | Reuters
The federal reserve will seek to reduce its workforce by 10% over the next two years, in particular by offering a deferred resignation to certain older employees, said Central Bank Jerome Powell in a memo.
“The experience here and elsewhere shows that it is healthy for any organization to periodically look at its workforce and resources.
The head of the central bank added that he had asked the leaders throughout the Fed “to find additional means to consolidate the functions, if necessary, to modernize certain commercial practices and to ensure that we are a good size and able to respect our statutory mission”. A method to reduce staff will be to offer a voluntary delayed resignation program to the employees of the Federal Reserve Board who would be fully eligible to retire at the end of 2027.
The central bank said in its 2023 annual report that it had just under 24,000 employees. A 10% reduction would lead to this number of less than 22,000.
The memo occurs while the Trump administration has put pressure for cost reductions between public service agencies, led by Elon Musk and the so-called Ministry of Government Effectiveness. Musk previously called the “absurdly overvalued” Fed. Powell’s memo did not mention Musk or Doge as a factor in the decision to reduce the workforce.
The cuts provided by the staff were reported for the first time by Bloomberg News.
– Matt Cuddy from CNBC contributed the reports.
