Washington: Hundreds of internal contractors working for the U.S. Agency for International Development (USAID) have been placed on unpaid leave or terminated after President Donald Trump imposed a sweeping freeze on U.S. foreign aid. The furloughs and layoffs come as the administration conducts a 90-day review of foreign assistance programs, initiated shortly after Trump took office on January 20.
Despite the freeze, U.S. Secretary of State Marco Rubio issued a waiver overnight, allowing “life-saving humanitarian assistance” to continue, although health and humanitarian groups worldwide remain uncertain about the scope and coverage of this exception.
The administration insists the freeze is necessary to align U.S. foreign assistance with Trump’s “America First” policy and ensure taxpayer money is not being wasted. The U.S. remains the largest global donor of foreign aid, disbursing $72 billion in fiscal year 2023 for programs ranging from women’s health in conflict zones to clean water access, HIV/AIDS treatment, and energy security.
On Wednesday, the State Department confirmed that the pause in assistance had disrupted crucial programs, including the distribution of condoms and contraceptive services in Gaza, clean energy projects for women in Fiji, and family planning initiatives across Latin America. Although specific details on affected aid programs were not provided, the administration claimed that more than $1 billion in spending unrelated to the “America First” agenda had been halted.
The furloughs of hundreds of institutional support contractors at USAID followed the earlier suspension of about 60 career officials at the agency, a move seen by current and former officials as an attempt to silence dissent and raise concerns about the agency’s leadership. According to an anonymous USAID official, “stop-work” orders issued for institutional support contracts resulted in the furlough of 600 people within the Global Health Bureau.
One of USAID’s institutional support contractors, the Public Health Institute (PHI), informed its employees that their positions were terminated due to the stop-work order. PHI did not disclose the number of employees affected. USAID and the State Department have not commented on the situation.
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A second USAID official noted that contractors attempted to push their work forward, ensuring that files were handed over to individuals who could continue the mission. “People aren’t being defiant of the orders. They’re just insisting on finding ways to continue to pursue the mission of this agency overall,” the official said, warning that the delivery of aid after the 90-day review will be “very hard” without these contractors.
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In response to Trump’s executive order, the State Department issued global stop-work directives, freezing nearly all foreign aid except for emergency food assistance. Rubio outlined the waiver as covering essential life-saving services such as core medicines, medical services, food, shelter, and subsistence aid, but excluded programs related to abortion, family planning conferences, gender or DEI (diversity, equity, and inclusion) initiatives, and non-life-saving assistance. These restrictions have created confusion among global humanitarian organizations, forcing many to assess the risks of continuing their work without clear guidance.
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The State Department also revealed that national security waivers had been granted to protect U.S. personnel abroad and enforce non-proliferation obligations, with exceptions reviewed and approved promptly when necessary.
