WASHINGTON D.C.: In a small but rare reduction to its headcount, which has grown steadily since 2010, the US Federal Reserve is cutting some 300 people from its payroll in 2023.
In a statement, a U.S. central bank spokesperson said the redundancies would affect staff in the Fed's 12 regional reserve banks, mainly focused on information technology jobs, and represent a combination of attrition, including retirements and layoffs.
According to the Fed's annual reports and financial documents, the number of its budgeted staff, including its regional banks, the Washington-based Board of Governors, and three smaller units, will be reduced by more than 500 positions from 2022 to 2023, from 24,428 to 23,895, the first time its budgeted headcount has dropped since 2010.
A related memo released in December said that the main reason for the positions being eliminated this year was "higher than-budgeted turnover and extended lags in filling open positions," most notably in bank supervision.
In recent months, the Fed has operationally recorded losses of US$100 billion, which include paying more in interest to banks on reserve deposits than the central bank earns from its portfolio of bonds and mortgage-backed securities worth some $7.5 trillion.
The Fed is self-funding, unlike federal agencies that rely on tax dollars allocated by Congress.
The U.S. central bank usually generates a profit that is turned over to the U.S. Treasury, but since it began increasing interest rates to curb rising inflation, it has been spending more than it earns annually.