President Trump's push to shutter the U.S. Department of Education is colliding with reality: the Office of Federal Student Aid (FSA) is now scrambling to fill nearly 400 positions, just over a year after losing roughly half its staff in the 2025 reduction-in-force.
According to reporting on internal documents obtained by NPR, FSA is adding around 380 new workers. The office sits at 731 full-time equivalent staff today (down from 1,440 before the current administration) and needs to hire an additional 334 FTEs to hit its target. Fifty-two new workers have already been onboarded since September.
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Why It Matters: FSA runs the $1.7 trillion federal student loan portfolio, serves 43 million borrowers, and administers the FAFSA.
The hiring comes as the office is also tasked with rolling out new student loan borrowing limits and two new repayment plans — institutional work that requires the staffing the agency just gutted.
Education Secretary Linda McMahon had previously admitted the cuts went too far: "Sometimes you cut into the muscle and you cut a little too deep. And we've brought some people back. Not a lot, but we did find that we cut a little bit deep."
How Dismantling The Department of Education Fits In: The hiring contradicts public statements that FSA's responsibilities are being offloaded to the Treasury Department and other agencies.
McMahon has announced 10 interagency agreements meant to hand off Education Department functions, including student loan servicing to Treasury.
Sen. Tammy Baldwin (D-Wis.) pressed McMahon on the same point in a recent Senate hearing, noting that Education Department employees appear to be administering the same programs — just from different buildings.
And we've called out the hypocrisy of these interagency agreements before.
How This Connects: The College Investor previously reported on the Treasury Department taking over defaulted student loan collections under the same interagency agreement, with later phases expected to expand Treasury's role into non-defaulted loans, FAFSA administration, and Pell Grants.
We also covered the October layoff round that cut another 466 employees during the government shutdown, bringing total Department of Education headcount from roughly 4,200 in 2024 to about 2,300 today.
According to the National Association of Student Financial Aid Administrators (NASFAA), 60% of college financial aid offices have reported slower federal processing and worse communication since last year's layoffs.
For 43 million student loan borrowers, the practical question isn't who's signing the paychecks at FSA, it's whether the agency can hire and train fast enough to keep the loan system functioning.
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Editor: Colin Graves
Robert Farrington is the founder of The College Investor and is widely recognized as one of the nation’s leading voices on student loan debt and saving for college. He holds an MBA from UC San Diego Rady School of Management and has spent over 15 years researching, writing, and advising on student loans, 529 plans, financial aid programs, and saving and investing for young professionals.
Robert has been featured in the The New York Times, The Wall Street Journal, The Washington Post, NBC News, and Forbes, where he has been a regular personal finance contributor for over a decade. His work combines both professional expertise and personal experience – he successfully navigated his own student loan repayment journey and has helped thousands of readers do the same.
He is committed to making the intersection of personal finance and education transparent and accessible. You can learn more about Robert on the About Page or on his personal site RobertFarrington.com.