Federal agencies spent an estimated $9.5 billion paying employees on leave in 2025, and most of that bill came from one workforce-shrinking program tied to resignations.
Story Snapshot
- $9.5 billion in salary costs for paid administrative leave in 2025, a sixfold jump from 2023.
- About $6.7 billion linked to the Deferred Resignation Program that encouraged quits.
- Leave days soared to about 21.6 million in 2025, up from roughly 4–4.4 million before.
- Office of Personnel Management says one-time costs will yield $40 billion in yearly savings.
The Number That Stopped Washington Cold
The Government Accountability Office estimated agencies spent $9.5 billion on paid administrative leave in 2025, about six times 2023 levels. Coverage of the watchdog’s findings framed the surge as a 435% rise in leave use over two years, the kind of jump you usually only see in crisis spending, not payroll practices. The spike coincided with a push to reduce the federal workforce under the Department of Government Efficiency effort in the Trump administration, which set the stage for how and why the leave piled up.
Reporters who reviewed the Government Accountability Office estimate say the core driver was the Deferred Resignation Program. That program offered a simple trade: resign by a set date in 2025 and, in many cases, stop reporting to work until then. Roughly $6.7 billion of the leave costs fell into that bucket, making it the dominant line item in the total. This structure made leave both a bridge to exit and a budget shock hitting in one year rather than spread over several.
How a Resignation Offer Turned Into Leave at Scale
The Office of Personnel Management’s guidance explained that agencies have broad discretion to grant administrative leave, and the deferred resignation materials noted that participants could be placed on leave until their resignation date. That design meant the more employees who opted in, the more paid leave days would accrue. The math showed up fast: workdays on paid administrative leave jumped from about 4–4.4 million in 2023–2024 to about 21.6 million in 2025, a fivefold leap in days that tracked the cost surge.
The concentration of costs in the Deferred Resignation Program gave critics and supporters different talking points. Supporters of smaller government saw a one-time expense to clear positions quickly and reset a bloated headcount. Critics saw a payout for people not working while agencies scrambled to adapt. The Government Accountability Office estimate gave both sides a scoreboard but also reminded readers that estimates depend on agency reporting and coding choices. The Office of Personnel Management’s own accounting limits added fog to the exact totals, even as the headline number landed.
What Defenders Say the Taxpayer Gets Back
The Office of Personnel Management director, Scott Kupper, defended the bill as a trade with a payoff. He said the $9.5 billion in 2025 is a one-time cost that will be offset by about $40 billion in annual savings from a smaller workforce going forward. That claim rests on headcount reduction, lower long-term payroll, fewer benefits obligations, and less overhead. The conservative case here is straightforward: if you shrink government for real, you stop paying for roles you do not need, and that discipline compounds year after year.
The Government Accountability Office (GAO) recently published a report detailing how the Trump administration’s efforts to downsize the government led to $9.5 billion being spent on salary costs for administrative leave in 2025. This is six times the amount spent on… pic.twitter.com/xTXDAb4A1L
— Straight Arrow (@StraightArrow__) September 18, 2026
Common sense demands two checks. First, did the program actually reduce positions rather than refill them later under new titles? Second, did agencies redesign work so service did not degrade? Hard savings arrive only if the payroll drops and stays down, and services keep pace with demand. On the numbers presented, the Deferred Resignation Program explains about 70% of the 2025 leave costs, which aligns with the idea that the bill came from buyouts and exits rather than routine leave categories.
The Management Lesson Behind the Headline
Governments often pay now to save later. The surprise here is the scale hitting in one calendar year. The design used administrative leave as the off-ramp, which made transition costs visible in payroll instead of in a separate line item. That choice created cleaner exits but messier optics. For taxpayers, the question is not whether $9.5 billion is large. It is whether 2026 and 2027 payrolls fall enough to prove Kupper right, and whether agencies hold the line on rehiring as pressures return.
Sources:
reason.com, cbsnews.com, theguardian.com, politico.com, govexec.com
