US Job Cut Announcements More Than Double, Reaching Recession-Era Levels
US employers announced 172,017 job cuts in February, a 103% surge from the same period last year and the highest February total since 2009, Challenger, Gray & Christmas reported Thursday.
February’s total marks a 245% increase from January’s 49,795 job cuts and represents the highest monthly total since July 2020 when the economy was still reeling from pandemic-related shutdowns.
“Private companies announced plans to shed thousands of jobs last month, particularly in Retail and Technology. With the impact of the Department of Government Efficiency actions, as well as canceled Government contracts, fear of trade wars, and bankruptcies, job cuts soared in February,” said Andrew Challenger, Senior Vice President at Challenger, Gray & Christmas.
Government cuts led all sectors, with 62,242 announced job reductions across 17 federal agencies. This represents a staggering 41,311% increase from the 151 government cuts announced through February 2024. Retail followed with 38,956 cuts, while Technology companies announced 14,554 reductions.
The primary reasons cited for the job cuts include DOGE actions (63,583), bankruptcy (35,172), market conditions (28,098), and corporate restructuring (16,828). The Challenger report also identified 894 additional job cuts among nonprofits due to downstream impacts from federal funding losses.
Geographically, the East region experienced the steepest increase, with job cuts rising 109% year-over-year to 107,109. The District of Columbia saw cuts skyrocket from just 60 last year to 61,795 this year. The Midwest region also recorded significant increases, up 61% to 41,506 cuts, with Ohio seeing a 519% surge.
Despite the concerning layoff numbers, the report contained some positive indicators. Companies announced plans to hire 34,580 workers in February, the highest February total since 2022 and part of an overall 159% increase in hiring plans year-to-date. Entertainment/Leisure led with 28,000 planned hires, followed by Automotive (4,831) and Technology (3,225).
Year-to-date, employers have announced 221,812 job cuts, the highest January-February total since 2009 and 33% above the 166,945 cuts announced during the same period last year.
“It appears the administration wants to cut even more workers, but an order to fire the roughly 200,000 probationary employees was blocked by a federal judge. It remains to be seen how many more workers will lose their Federal Government roles,” Challenger added.
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