The U.S. labor market, long considered a pillar of economic resilience, is showing unmistakable signs of strain as job cuts surge and hiring plans dwindle, according to a flurry of new data released in early November. The latest figures paint a picture of a job market in transition—one grappling with the aftershocks of pandemic-era hiring booms, the rapid adoption of artificial intelligence, and a notable softening in both consumer and corporate spending.
According to Challenger, Gray & Christmas, a global outplacement and executive coaching firm, U.S.-based employers announced a staggering 153,074 job cuts in October 2025. That figure represents a 183% increase from the 54,064 jobs cut in September, marking the largest single-month total since October 2003, when 171,874 cuts were recorded. Andy Challenger, the firm’s chief revenue officer and workplace expert, observed, "Some industries are correcting after the hiring boom of the pandemic, but this comes as AI adoption, softening consumer and corporate spending, and rising costs drive belt-tightening and hiring freezes."
The numbers are even more striking when viewed in the context of the year so far. Through October, employers announced 1,099,500 job cuts—up 65% from the 664,839 cuts in the first ten months of 2024 and 44% higher than the 761,358 cuts announced in all of last year. Workers facing layoffs are also finding it harder to land new roles quickly, Challenger noted, reflecting a job market that is not only shedding positions but also struggling to absorb displaced workers.
Technology, once the darling of pandemic-era growth, continues to lead private-sector job cuts. In October alone, tech companies announced 33,281 job cuts—a dramatic jump from 5,639 in September. For the year, the sector has shed 141,159 jobs, a 17% increase compared to the same period in 2024. The sector’s woes are tied to restructuring efforts as companies integrate AI, face slower demand, and seek greater efficiency. Warehousing, another sector that expanded rapidly during the pandemic, announced a jaw-dropping 47,878 job cuts in October, up from just 984 in September. For 2025 so far, warehousing has lost 90,418 jobs—a 378% jump from the 18,904 cuts in the same period last year—suggesting that overcapacity and automation-driven restructuring are now the order of the day.
Retailers, too, are feeling the pinch, though October’s 2,431 job cuts were slightly down from September’s 2,577. Still, the sector’s year-to-date tally of 88,664 job cuts is up 145% from the 36,136 announced through October last year. The industry continues to battle cost pressures, shifting consumer habits, and the ongoing trend of store closures. Non-profits, often considered a buffer in tough times, have not been spared either. They have announced 27,651 job cuts so far in 2025, a staggering 419% increase from the 5,329 cuts by this point in 2024, as organizations struggle with government funding shortfalls and rising operational costs.
Other sectors are also feeling the heat. The service sector, which provides support to other businesses—think cleaning, staffing, and outsourcing—announced 1,990 job cuts in October, down from 6,290 in September. Year-to-date, service firms have announced 63,580 job cuts, up 62% from the 39,296 cuts in the same period last year. The consumer products sector saw 3,409 job cuts in October, up from 1,983 in September, with a year-to-date total of 41,033—21% more than in 2024.
Meanwhile, the pace of hiring has slowed to a crawl. Challenger, Gray & Christmas reports that through October, U.S. employers announced plans for just 488,077 new hires—a 35% drop from the 750,333 announced by this time last year. This is the lowest year-to-date hiring total since 2011, with an average of only 48,808 new hires per month. That’s a far cry from the pandemic rebound years and signals a more cautious approach as companies navigate economic headwinds.
Separate data from ADP Research, released on November 11, adds another layer to the story. U.S. companies shed an average of 11,250 jobs per week in the four weeks ending October 25, 2025. This is the first such decline recorded by ADP since August, when nearly 20,000 jobs were lost in a four-week span. Earlier in October, the job market had shown some promise—ADP reported a private-sector payroll increase of 42,000 jobs, outpacing Wall Street estimates and rebounding from 29,000 jobs lost in September. Yet, the latter half of October saw a sharp reversal, with ADP noting that the labor market "struggled to produce jobs consistently during the second half of the month."
Economists and market analysts are taking note of these warning signs. Goldman Sachs analysts projected a decline of 50,000 U.S. nonfarm payrolls in October, which would be the largest single-month drop since late 2020. Economists surveyed by Dow Jones were even more pessimistic, expecting a 60,000-job decline and a rise in the unemployment rate to 4.5%. Indeed, a leading job site, reported that job openings have fallen to their lowest level since February 2021, further underscoring the cooling labor demand. The Bureau of Labor Statistics, whose reporting has been delayed by the government shutdown, last noted an increase of 22,000 nonfarm jobs in August, with unemployment ticking up to 4.3%.
These trends are not occurring in a vacuum. The rapid adoption of AI and automation is reshaping entire industries, from technology to warehousing, as companies look to streamline operations and reduce costs. At the same time, consumer and corporate spending has softened, putting pressure on retailers, consumer product companies, and service providers alike. Non-profits, often reliant on government grants and donations, are being squeezed by funding uncertainties and inflation-driven expense increases. Even sectors once thought immune to economic cycles, like warehousing, are being forced to adapt to a post-pandemic reality where demand and capacity are no longer in sync.
For workers, the implications are sobering. As Andy Challenger put it, "those workers who are laid off are finding it harder to quickly secure new roles." With job openings at multi-year lows and hiring plans at their weakest since 2011, displaced employees face a tougher road back into the workforce. The labor market’s remarkable post-pandemic recovery appears to be giving way to a period of retrenchment and recalibration.
While it remains to be seen whether these job losses will trigger a broader economic downturn or represent a painful but necessary adjustment, the data leaves little doubt: the U.S. job market is entering a new, more uncertain phase, with ripple effects likely to be felt across industries and communities in the months ahead.
