White House says layoffs 'imminent' with no end to shutdown in sight

Mass layoffs of US federal workers are "imminent" and could result in people permanently losing their jobs within days, the White House says, as a government shutdown continues for a second day.

Lawmakers are trading blame over the shutdown - the first for almost seven years - under which thousands of workers have been put on unpaid leave.

President Donald Trump has called on Republican allies to use it as an "opportunity" to make more lasting cuts.

The shutdown began on Wednesday, after Republicans and Democrats in Congress failed to agree a new spending plan. There is little sign of either side compromising and the next vote to try and end the situation will not be held until Friday.

The Senate is currently adjourned, raising fears that the situation could drag on and threaten hundreds of thousands of jobs, as well as risk costing the US economy billions in lost output.

At a White House briefing on Wednesday afternoon, Vice-President JD Vance made a rare appearance alongside Press Secretary Karoline Leavitt and accused opposition Democrats of playing political games.

"If they are so worried about the effect this is having on the American people, and they should be, what they should do is reopen the government, not complain about how we respond," he said.

Leavitt, meanwhile, indicated that mass job cuts could happen before the end of the week. Pressed by reporters about timeframes, she said "two days, imminent, very soon" and promised further updates.

"Sometimes you have to do things that you don't want to do," Leavitt explained, adding that "Democrats put us in this position".

Trump previously warned that a prolonged shutdown could present him the opportunity to make irreversible cuts to "Democrat things".

Writing on his Truth Social site on Wednesday evening, he added: "Republicans must use this opportunity of Democrat forced closure to clear out dead wood, waste, and fraud. Billions of Dollars can be saved."

His administration announced the same day that $18bn (£14bn) would be withheld for infrastructure projects in New York City - the home city of the Democratic leaders in the House and Senate.

Vance's comments at the White House represented the latest dig in what has been a bitter blame game between both parties, with the top Senate Democrat Chuck Schumer earlier accusing Republicans of trying to "bully" Democrats into accepting their funding plan.

Democrats want to secure guarantees on healthcare funding before they agree to a spending deal, while Republicans want to use a temporary stop-gap measure to keep the government open until mid-November and funded at current levels.

Schumer and his allies say they allowed the government to shut down in an attempt to negotiate to save healthcare benefits for lower-income Americans. They have said efforts to negotiate with Republicans over these benefits have so far been unsuccessful.

“Why are they boycotting negotiations? I've never witnessed this in my life," Senator Chris Murphy, a Democrat from Connecticut, said of Republicans. “The matter is the government will open when Republicans get serious about it talking to Democrats.”

Meanwhile, Republicans - who control both chambers of Congress but do not have the 60 votes needed to pass a funding bill - have said these healthcare benefits are not the priority, keeping the government open is.

"It's not about who wins or who loses or who gets blamed and all this,” Senate Majority Leader John Thune said. “It's about the American people. And [Democrats] have taken the American people hostage in a way that they think benefits them politically."

Republicans have also argued the healthcare extensions Democrats are looking for will cost American taxpayers more money and were instituted to manage Covid-era complexities that no longer exist.

Essential workers such as border agents and the military may be forced to work without pay for the time being - but government employees deemed non-essential are temporarily put on unpaid leave. In the past, these workers have then been paid retrospectively.

Analysts expect this shutdown to happen on a larger scale than the last one in 2018, when Congress had passed some funding bills. They expect roughly 40% of federal workers - around 750,000 people - to be put on temporary leave.

Some workers were furloughed on Wednesday. At the White House, Vance reiterated the threat of permanent layoffs of federal workers.

"Let's be honest, if this thing drags on, we are going to have to lay people off," he said.

Vance also made the claim - repeatedly denied by Democrats - that the shutdown was a result of senior Democrats advocating for healthcare benefits to be extended to undocumented migrants.

US law already prohibits undocumented migrants from gaining any federally subsidised healthcare coverage. "Nowhere have Democrats suggested that we're interested in changing federal law," House Minority Leader Hakeem Jeffries said.

Russell Vought, the White House's budget chief, briefed Republicans behind closed doors on what the impending layoffs could look like, although public details of those plans are sparse.

On Capitol Hill, there was little appetite for a deal to end the standoff on Wednesday.

"There's nothing to negotiate. There's nothing we can pull out of this bill to make it any leaner or cleaner than it is," Republican Speaker of the House Mike Johnson said.

Another vote on the short-term funding bill proposed by Republicans is expected on Friday.

With additional reporting from Bernd Debusmann Jr at the White House

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