'Domino effect' of Trump policies to spread pain nationwide: economists

CNBC is reporting that President Donald Trump and X owner Elon Musk's cuts to the federal workforce may amount to "the biggest job cut in U.S. history" that could also hurt the U.S. economy as a whole.

Depending on different variables, experts who spoke with CNBC estimate that hundreds of thousands of federal workers could soon be unemployed, which would be a significant negative economic shock felt throughout the entire country.

Callie Cox, the chief market strategist at Ritholtz Wealth Management, wrote last week that cuts of this magnitude would bring real economic pain, and not just to places like Washington D.C. but to communities throughout the United States where federal workers are located.

"We may soon find out the hard way that people drive the U.S. economy," she warned.

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Erica Groshen, a senior economics advisor at Cornell University and former commissioner of the U.S. Bureau of Labor Statistics, similarly told CNBC that these job losses would ripple throughout the whole economy.

"There are economic impacts to [laid-off workers], their families, to the businesses they would have bought goods and services from," she said.

Ernie Tedeschi, director of economics at the Yale University Budget Lab, sounded a similarly pessimistic note.

“The economic consequences of layoffs are like a domino effect that spread across local economies to businesses that seem to have no connection whatsoever to the federal government," he said, although he also added that these layoffs in and of themselves would not be enough to push the economy into a recession.