Trump's Federal Job Cuts Gets Supreme Court Go-Ahead: DOGE Outpaces Big Tech In Layoffs Across US Bureaucracy

The U.S. Supreme Court on Tuesday removed a key legal barrier to President Donald Trump‘s mass federal workforce reduction plans, potentially affecting tens of thousands of government employees while reshaping bureaucratic operations that impact market sectors from defense contracting to regulatory oversight.

What Happened: In a brief, unsigned order, the court ruled the Trump administration was “likely to succeed” in arguing that executive orders directing agency downsizing fall within presidential authority, Reuters reported.

The decision overturned San Francisco-based U.S. District Judge Susan Illston‘s May injunction that temporarily blocked large-scale federal layoffs.

The ruling affects multiple agencies, including the Treasury, State, Veterans Affairs, Agriculture, Commerce, and Health and Human Services departments. State Department officials immediately announced plans to resume their reorganization targeting nearly 2,000 employees, according to a Reuters report.

Since January, the Department of Government Efficiency (DOGE) has overseen 260,000 federal worker departures through firings, resignations, and early retirements.

This exceeds the combined 2025 tech sector layoffs from Intel Corp. (NASDAQ:INTC), Meta Platforms Inc. (NASDAQ:META), Alphabet Inc. (NASDAQ:GOOGL) (NASDAQ:GOOG), Amazon.com Inc. (NASDAQ:AMZN), and Microsoft Corp. (NASDAQ:MSFT).

See Also: Trump’s Tariff Letters Spark ‘High Level Of Uncertainty And Volatility,’ Says Economist Mohamed El-Erian

Why It Matters: DOGE has documented $175 billion in cuts against its $1 trillion savings target. The agency has eliminated 27.3% of Health and Human Services staff, 23.5% of Transportation workers, and 13.3% of Defense Department personnel, according to layoff tracking data.

Justice Ketanji Brown Jackson dissented, criticizing the court’s “demonstrated enthusiasm for greenlighting this president’s legally dubious actions in an emergency posture.”

The downsizing effort has virtually shuttered the U.S. Agency for International Development and Consumer Financial Protection Bureau, potentially affecting regulatory oversight of financial markets and international trade operations. A Reuters/Ipsos poll found 56% of Americans support federal workforce reduction efforts.

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Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.

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