US Layoffs Top 1.1 Million in 2025, Highest Since Pandemic: Challenger Report

Corporate restructuring, artificial intelligence, and tariffs have fueled the steep rise in job cuts.

Announced job cuts from U.S. employers exceeded the one-million mark for the year in November, driven by factors including corporate restructuring, rapid adoption of artificial intelligence, and trade tariffs, consulting firm Challenger, Gray & Christmas reported on Thursday.

The firm stated that total layoff plans for November reached 71,321. While this was a decrease from the massive cuts announced in October, it was enough to push the 2025 year-to-date total to 1.17 million. This figure is 54% higher than the total recorded during the same 11-month period a year ago, making it the highest level since 2020, when the COVID-19 pandemic severely disrupted the global economy.

AI, Tariffs, and Restructuring Drive Cuts

Verizon’s announcement of more than 13,000 job reductions significantly contributed to the November total.

• Technology Sector: Tech companies, spurred by advancements in AI, listed 12,377 reductions, pushing the sector’s 2025 cumulative total up by 17% compared to the previous year. Artificial Intelligence (AI) itself was cited as the direct cause for 54,694 layoffs this year.

• Tariff Impact: Tariffs were cited as the primary driver for over 2,000 cuts in November and nearly 8,000 year-to-date.

• Top Reasons: The most common reason cited for layoffs in November was restructuring, followed by business closings and broader market or economic conditions.

Andy Challenger, chief revenue officer at Challenger, Gray & Christmas, noted that although plans fell last month, “job cuts in November have risen above 70,000 only twice since 2008: in 2022 and in 2008.” He also mentioned that companies have largely shifted away from announcing layoffs toward the year’s end since the Great Recession, prioritizing timing outside of the holiday season.

The November total offered some relief compared to the over 153,000 cuts announced in October, which was the highest total for that month in 22 years.

Mixed Signals in the Labor Market

The high layoff numbers arrive amidst growing concern over the state of the U.S. labor market:

• Private Sector Decline: ADP reported that private employers cut 32,000 jobs in November, marking the largest decline in more than two and a half years.

• Hiring Slump: The Challenger report noted dimming hiring prospects, with employers announcing 497,151 planned hires, a drop of 35% from the same point in 2024.

Despite these signs of weakness, Labor Department data has yet to confirm a surge in layoffs. The department reported that weekly jobless claims unexpectedly tumbled to 191,000, the lowest in over three years. This decline was attributed to unusually large drops in California and Texas, and was likely influenced by the timing of the Thanksgiving holiday.