About 250 civil service jobs will be moved to London after a government department confirmed plans to close its Sheffield office.
The Department for Business, Innovation and Skills (BIS) is relocating to the capital in what it says is part of measures to help save £350m by 2020.
Staff based in Sheffield will be offered financial help if they choose to relocate to London.
But the Public and Commercial Services Union called the decision "shameful".
The office in St Paul's Place will close in January 2018, and government officials have said "anyone who wants a role in London will be able to have one".
Permanent secretary Martin Donnelly said the move was intended to "modernise the way the department works" and "had not been made lightly".
"It remains our top priority that staff are fully supported and briefed on what this means for them and their options," he added.
The government said all staff would be able to stay in their current location until January 2018.
Mark Serwotka, general secretary of the PCS union, said the decision "flies in the face of what the government claims to want for the north and the wider civil service".
He added: "As a northern powerhouse city, ministers should be investing in jobs in Sheffield, not devolving them back to central London," he said.
"We do not believe there is any money to be saved by closing this office, it could actually end up costing more, and we will continue to campaign to reverse the decision."