The impasse over the proposal is entering its second week. Hundreds of protesters packed the state capitol building in Madison on Monday. They are upset over the governor's plan to eliminate collective bargaining negotiations for unionized workers and tack on high health care premiums for state employees.
Walker didn't say which workers would be affected by the layoffs. He said he hopes it doesn't get to that point.
The proposal, designed to help Wisconsin plug a projected $3.6 billion budget hole, has led to eight straight days of massive protests that grew as large as 68,000 people on Saturday.
Security was tight in the Capitol on Tuesday morning as both the Senate and Assembly were scheduled to be in session.
Senate Democrats have stopped the measure by not showing up to debate or vote. Fourteen Democrats walked out on Thursday, making it impossible for the remaining Republicans to take up the measure.
Walker and Republican leaders have repeatedly called on the Democrats, who escaped to Illinois, to return and get back to work.
Democrats have said they won't come back until the governor is willing to negotiate.
The Associated Press contributed to this report.