The federal government of Canada plans to cut nearly 40,000 public sector jobs

The federal government of Canada plans to cut nearly 30,000 public sector jobs — a total reduction of 40,000 positions, or about 10% from the 2023 peak. Economists compare the cuts to those made under Stephen Harper.

The National Capital Region is expected to lose around 15,000 jobs. By 2028, the federal workforce will shrink from 368,000 to about 330,000. Most reductions will occur through natural attrition and early retirements, costing the government an estimated $1.5 billion.

Departments such as Defence, Indigenous Services, and Women and Gender Equality will face minimal (2%) cuts, while others must save up to 15% of their operating budgets.

The budget aims to save $25 billion over four years by modernizing operations, adopting AI and digital tools, and reducing travel and consultant spending. However, experts warn that even as it downsizes, Ottawa is still relying on the public service to deliver major initiatives in housing, defence, and national security.