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DOGE-Backed Software Revamp to Accelerate U.S. Government Layoffs Amid Musk’s Exit

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A powerful new software tool developed under Elon Musk’s Department of Government Efficiency (DOGE) is set to accelerate mass layoffs across the U.S. federal workforce, just as Musk steps back from the initiative, Reuters reported in an exclusive on Thursday.

The program, a modernized version of the decades-old Pentagon “AutoRIF” (Reduction in Force) system, has been rebranded as the Workforce Reshaping Tool. It promises to drastically reduce the time it takes to process mass layoffs by automating tedious, error-prone manual HR processes used across federal agencies.

With over 260,000 federal workers already laid off, retired early, or bought out since President Trump’s return in January, the system is expected to play a key role in what critics have called an aggressive federal downsizing strategy. Agencies like the Department of Veterans Affairs and the IRS are preparing cuts of up to 80,000 and 40% of their staff respectively.

The revamped software enables bulk data upload, real-time collaboration, and rapid analysis of eligibility for dismissal based on factors like seniority, veteran status, and performance. This is a significant improvement over the old version, which allowed only one user at a time and required manual entry of individual personnel records.

Though DOGE claims to have saved $160 billion through cost-cutting measures, few specifics had been disclosed until now about how technology was aiding that effort. The Workforce Reshaping Tool appears to be the first tangible result of DOGE’s mandate.

The timing is critical: the software is being deployed just as legal challenges and employee reinstatements highlight growing concerns over mistakes and fairness in the layoff process. Experts warn that while automation improves speed, it may amplify systemic flaws.

“If you automate bad assumptions into a process, the scale of the error becomes far greater,” said Don Moynihan of the University of Michigan.

Despite Musk’s planned step back to focus on Tesla and his other companies, analysts believe the automation project he set in motion will continue independently — reshaping the future of federal employment.

Treasury’s Bessent Says $2 Billion Cut from IRS Tech Budget Without Operational Disruptions

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U.S. Treasury Secretary Scott Bessent told lawmakers Tuesday that the Trump administration has already cut $2 billion from the IRS information technology budget without disrupting operations and plans to save hundreds of millions more through automation and efficiency reforms.

Speaking before a House Appropriations subcommittee, Bessent revealed that the IRS had been spending approximately $450 million annually on processing paper forms, with around 6,500 full-time staff dedicated to the task. By introducing policy changes and automating manual workflows, the Treasury aims to reduce that expense to under $20 million by the end of President Trump’s second term.

The savings so far have been achieved by eliminating unused software licenses, renegotiating contracts, and cutting what Bessent called “wasteful” IT and professional services deals. He projected long-term savings of hundreds of millions of dollars annually in IRS operations.

Bessent also defended the proposed $2.5 billion budget cut for the IRS in the fiscal 2026 White House budget, calling its current tech budget “bloated” due to the Biden-era Inflation Reduction Act, which had allocated $80 billion to enhance IRS IT and tax enforcement. That funding has since been halved by Republican-backed budget rollbacks.

Responding to Democratic concerns that budget cuts could weaken tax enforcement, Bessent said the IRS can maintain strong collections by leveraging AI tools and smarter IT infrastructure, noting that collections remain robust and that training personnel for high-end audits takes years.

He also touched on the looming U.S. debt ceiling, refusing to predict when Treasury would exhaust its borrowing authority but warning that the government is “on the warning track” — close to the limit. Bessent assured lawmakers that no gimmicks would be used to avert default and that Congress would ultimately need to raise or suspend the limit.

Bessent echoed former Treasury Secretary Janet Yellen’s stance on monitoring debt-to-GDP ratio rather than the raw debt number, and said the administration aims to both control debt levels and boost economic growth.

On a lighter note, Bessent also said the Treasury is examining ways to reduce the cost of minting nickel coins, noting: “I believe the dime is profitable.”

How Canada’s Shopify is Using AI to Revolutionize E-Commerce for Small Merchants

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Heather Perry, CEO of Klatch Coffee, made a strategic shift last year, moving her family-owned roastery’s e-commerce operations to Shopify in time for the busy holiday season. The 42-year-old Southern California entrepreneur was drawn to Shopify’s AI-based tools, which automate routine tasks like generating discounts and product descriptions, as well as providing improved customization and a broader range of apps.

“Running the business from scratch during the holiday season? I can’t even imagine,” Perry said, highlighting how Shopify’s quick adaptability was crucial for her business. Shopify’s suite of AI services, dubbed “Shopify Magic,” has been a game-changer for hundreds of small businesses, leveling the playing field by providing automation tools previously only available to large retail giants.

Shopify’s revenue is expected to grow 27.3% in the holiday quarter, driven in part by this AI revolution. This is a significant outperformance when compared to global e-commerce growth, which is projected at 8.4% in 2024. Shopify’s revenue growth of 24.6% surpasses the industry’s rate, signaling a post-pandemic rebound after the initial slowdown when lockdown-driven online shopping growth tapered off.

The number of stores registered on Shopify rose 20% in the July-September quarter, a sign of renewed momentum. Analysts note that Shopify is attracting a large volume of sellers, with some likening the growth pace to that seen during the pandemic lockdowns.

For small business owners like Jackson Mlawer of Daily Harvest, Shopify’s AI tools are a “game-changer,” with the platform helping to automate tasks such as content generation, product description writing, and even packaging optimizations. The company has saved over 20 hours per month and boosted web traffic by 40%. Many other merchants, around 50%, plan to use AI tools for content creation, with 33% leveraging AI for marketing purposes.

AI also enables Shopify to consolidate e-commerce services such as inventory management, payments, and taxes into a unified platform. This simplification appeals to Shopify’s core customer base, which is typically less tech-savvy. “The more capabilities Shopify can present on a single stack, the simpler it becomes for non-tech users,” said analyst Ken Wong. Shopify’s integrated features make it easier for merchants who previously struggled with smaller platforms, many of whom migrate to Shopify for its streamlined solutions.

Merchants, like Jill Dobson of Jill’s Homestead, have found Shopify’s system more reliable than other platforms, simplifying operations by consolidating payment processing and reducing reliance on external apps. Shopify’s AI-powered image generation tools also helped Dobson cut her professional photoshoot costs.

Despite impressive growth, the company faces potential challenges related to margins. Analysts have expressed concern that new technology investments, while driving growth, could put pressure on profitability. The platform’s payment partnerships, such as with PayPal, could reduce transaction fees, impacting profit margins.