Federal public service shrinks for second year as Carney targets 40,000 jobs

The Treasury Board of Canada Secretariat's headquarters located at 90 Elgin St. in Ottawa. Photo by TONY CALDWELL /Postmedia

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For the second year in a row, the federal public service has recorded a decrease in the number of jobs, reversing a decade-long trend of increases to the public payroll.

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According to numbers released this week by the Treasury Board of Canada Secretariat, there were 345,282 federal public servants at the end of March 2026, down from 357,965 the previous March. This represents a drop of 12,683 positions, or just over 3.5 per cent.

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The decrease follows a similar reduction from the previous year. In March 2024, the government employed 367,772 federal public servants. The combined drop amounts to 22,490 workers, or a 6.1 per cent decrease over two years.

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Canada’s population also fell slightly between March of 2025 and March of 2026, by just over 132,000 people to 41.47 million. This means that the percentage of Canadians who are employed by the public service declined to 0.83 per cent from 0.86 per cent.

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Not all departments faced the same drop, and some actually added positions within the year.

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The Department of National Defence, for instance, had 31,838 employees last March, an increase of 2,717 or just over nine per cent from the previous March. The Communications Security Establishment saw a similar hike to 4,029 from 3,686.

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Correctional Service Canada and the RCMP, meanwhile, remained almost flat in the number of employees, while the Canada Revenue Agency (CRA) saw the largest drop, shedding 3,725 workers over the year to stand at 48,774 this past March, a seven per cent dip.

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When Prime Minister Mark Carney’s government released its first budget last November, it said the federal public service would see “a decline of about 40,000” jobs by the end of the 2028-29 fiscal year. That included jobs that had been shed since the size of the public service peaked in 2023-24. The plan is to bring numbers down further, to about 330,000 by 2028-29.

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There has been some pushback to the plan. The Professional Institute of the Public Service of Canada (PIPSC) put out a statement in March warning that cuts to its workforce at the CRA would weaken the government’s ability to enforce tax laws and recover lost revenue.

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“These are the people who make sure everyone pays their fair share,” PIPSC President Sean O’Reilly said at the time. “Cutting them doesn’t save money. It costs money.”

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