WASHINGTON — The U.S. Department of Education's Federal Student Aid unit reduced its workforce by nearly 40% on March 11, 2025, according to an Office of Inspector General (OIG) report. By March 31, 2025, the unit retained 861 of its 1,446 employees, leaving key loan oversight functions understaffed. The OIG noted it did not differentiate between full-time and part-time staff in this count.

Nearly a quarter of Federal Student Aid's 136 suboffices had no remaining employees. Suboffices responsible for managing lending institutions, risk assessment, schools accepting federal loans, default rates, and colleges' median earnings were left unstaffed. Less than half of the staff who monitored data collection, managed the customer website and mobile app, and provided IT support remained.

Ellen Keast, press secretary for higher education at the Education Department, stated: "If anything, this 'report' demonstrates how effective the Trump Administration is." Keast added that the OIG report does not include staffing changes that have occurred since March 31, 2025. She also said: "With nearly half the staff, ED has effectively implemented some of the most sweeping higher education reforms in decades while returning education to the states."

The OIG report noted that the Education Department stated it had made agreements with other agencies to reduce the work performed by the department since March 31, 2025. The department announced it was bringing back more than 200 employees let go in March 2025. More than 50 new employees have joined Federal Student Aid since September.

The report stated that the Department did not provide all requested information or unfettered access to staff, which limited the analysis. "Although the Department has repeatedly cited concerns about ongoing judicial proceedings and court orders, it has not explained how granting us access to requested documents and to staff would place it at risk of noncompliance with those proceedings and court orders," the OIG report stated. It further noted: "Further, no corroborating evidence has been provided by the Department to support its assertion that it has continued to discharge the responsibilities referenced in the report since the RIF."

In April 2026, Federal Student Aid had 731 full-time staff and planned to hire an additional 334 full-time employees by 2027. The current hiring target is one-third smaller than the 1,568 staffers during the Biden administration.

Student loan borrowers have reported receiving monthly payment bills as low as $50 when their actual payments were thousands of dollars. Some borrowers cannot access the Pay As You Earn repayment plan.

Why It Matters

The staffing reductions affect the oversight of the federal student loan portfolio, impacting functions such as risk assessment, data collection, and borrower support. These changes occurred as nearly one in six American adults had federal student loan debt in 2026. The average federal student loan debt is $39,075, with higher averages for master's ($81,870) and doctoral ($180,757) graduates.