The US labor market, which in recent months had ground nearly to a halt, now appears to be entering a downward spiral.
As reported by the Washington Post on Thursday, new data from corporate outplacement firm Challenger, Gray & Christmas found that employers in October announced 153,000 job cuts, which marked the highest number of layoffs in that month since October 2003.
Total announced job cuts in 2025 have now reached 1.1 million, a number that the Post describes as a “recession-like” level comparable to the steep job cuts announced in the wake of the dotcom bust of the early 2000s, the global financial crisis of 2008, and the onset of the Covid-19 pandemic in 2020.
John Challenger, the CEO of Challenger, Gray & Christmas, told the Post that the huge number of October layoffs showed the economy was entering “new territory.”
“We haven’t seen mega-layoffs of the size that are being discussed now—48,000 from UPS, potentially 30,000 from Amazon—since 2020 and before that, since the recession of 2009,” he explained. “When you see companies making cuts of this size, it does signal a real shift in direction.”
CNBC noted that the Challenger report found that the tech sector is
currently being hardest hit by the layoffs, and it said that the adoption of artificial intelligence was a significant driver of job cuts.
“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 report said. “Those laid off now are finding it harder to quickly secure new roles, which could further loosen the labor market.”
With the backing of Big Tech investors, President Donald Trump has pushed to prevent states from regulating AI, over the objections of labor groups and progressive lawmakers. Last month, Sen. Bernie Sanders (I-Vt.) warned that without strong regulation, tech billionaires’ investments in AI will likely “increase their wealth and power exponentially” while wiping out “tens of millions” of jobs.
According to Bloomberg, however, AI adoption is just one factor in companies’ decision to enact mass layoffs, as some firms have also cited the need to protect their profit margins from the impacts of President Donald Trump’s tariffs, which have raised prices for a wide variety of products and materials.
Democratic lawmakers were quick to seize on the news of mass layoffs as evidence that Trump is sending the US economy into a ditch.
“Trump put billionaires in charge of everything,” remarked Rep. Greg Casar (D-Texas) in a social media post. “It’s a disaster.”
“Trump inherited the fastest growing economy in the [Organization for Economic Cooperation and Development], fastest reduction in inflation, record job creation,” said Rep. Sean Casten (D-IL). “Dumb tariffs, racist immigration policies, attacks on the rule of law and termination of congressionally mandated programs did this.”
Sen. Chris Murphy (D-CT), meanwhile, simply wrote that “Trump’s economy suuuuucks.”