This executive order is aimed at eliminating waste in the federal government. It directs the director of the Office of Management and Budget to submit a plan to reduce the size of the federal government workforce through efficiency improvements and attrition. The plan requires an agency hire no more than one employee for every four that depart, and it directs all federal agency heads to promptly undertake preparations to initiate large scale reductions in force and to make plans for the reorganization of federal agencies.

This executive order has been challenged in a number of federal cases; and a federal district court in California enjoined enforcement of the provisions calling for reductions in force and reorganizations, but on July 8, 2025, the U.S. Supreme Court lifted the stay pending the appeal of the case.

For businesses that interact with the federal government, this could result in delays resulting from reduced staffing.