USAID to Merge with State Department, Thousands Face Layoffs

WASHINGTON, D.C. — The U.S. Agency for International Development (USAID) will officially be absorbed by the State Department as part of a major restructuring announced Friday. Employees have been given 48 hours to collect their belongings, with many facing layoffs as the agency’s independent operations come to an end.

According to an internal memo obtained by Fox News Digital, the restructuring is designed to streamline foreign assistance programs but will result in significant staff reductions. More than 4,650 USAID personnel are expected to be laid off, including over 1,500 whose positions have already been cut in recent months.

“By integrating USAID’s core life-saving programs under the State Department, we will enhance the efficiency and accountability of foreign assistance efforts,” said Jeremy Lewin, acting USAID Deputy Administrator. This decision aligns with President Trump‘s ongoing push to align federal agencies with what his administration deems national interests.

Originally functioning as an independent agency focused on aid to impoverished nations, USAID’s merger into the State Department follows the appointment of Secretary of State Marco Rubio as acting administrator of USAID in February. The merger indicates a shift in the Trump administration’s approach to foreign aid, which has faced scrutiny over its alignment with broader U.S. policy goals.

On March 11, Secretary Rubio announced the cancellation of more than 80% of USAID programs following a lengthy review. This includes the elimination of approximately 5,200 programs, reducing USAID’s active initiatives from 6,200 to under 1,000. “While we are reorienting foreign assistance programs, we are committed to maintaining essential life-saving initiatives,” he stated.

The memo indicated that notices regarding employment status would begin arriving Friday, with affected employees facing separation dates of either July 1 or September 2. As the absorption process takes place over the next few months, the State Department will evaluate staffing needs for the programs transferred from USAID.

The merger raises concerns among critics who argue that it undermines the independence of an agency that has operated under Congressional authority since its inception in 1961. Some have stated that the administration’s approach violates executive limits and seeks to diminish agencies that do not fit into its agenda.

State Department spokesperson Tammy Bruce recently assured the public that the merger would not impact the U.S. ability to respond to international crises, such as natural disasters—citing readiness to provide aid as necessary.

Notably, programs that have received particular criticism, including those funding diversity, equity, and inclusion initiatives abroad, have faced scrutiny from the Trump administration, which has implemented broad cuts affecting multiple federal agencies.

In the broader context, the restructuring comes alongside a wave of layoffs across various governmental departments, as Musk, leading a group focused on eliminating government inefficiency, collaborates with the administration on these initiatives.

The future of USAID remains uncertain, with ongoing discussions regarding the final limits of its absorption into the State Department and how it will function under new leadership. Further information regarding employee transitions and program alignments is expected to be shared as the process develops in the coming weeks.