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Consulting firm Booz Allen Hamilton said Friday that it plans to lay off 2,500 jobs as the Trump administration tries to lower levels of government spending by stopping federal contracts.
The federal turnover is expected to reduce Booz Allen’s fiscal 2026 revenue by 3%, as much of the company’s revenue comes from government contracts.
President and CEO Horacio D. Rozanski said the company will view the change as a “short-term disruption” when preparing for future opportunities.
“Booz Allen is not standing still to see what will happen next, and we are actively acting to lead in the ever-changing market,” Rozanski said on Friday’s revenue call.
Booz Allen’s civil business plan will reduce the workforce as federal agencies, including the Department of Defense, have stopped or are reviewing commercial agreements with contractors.
Rozanski said on Friday’s call that their goal is to achieve a more “agile” and “efficient” federal government.
“We are seeing reorganizations of institutions, a decrease in levels of government personnel and spending, and contract review,” Rozanski said on the phone. “These are particularly serious in civilian institutions.”
After Secretary of Defense Pete Hegseth said defense health agencies would no longer use Accenture, Deloitte, Booz Allen and others to use consulting services at billions of dollars in cost saving efforts, his words were just over a month.
Since returning to the White House earlier this year, President Trump has been seeking to reduce the size and scope of the federal government. Elon Musk’s government efficiency division played a major role in efforts to reduce government spending, prompting Democrats to object to over-focus concerns.