Layoffs in the US Now Hit a 5-Year High

Summary

U.S. employers announced 1.17 million job cuts through November, the highest five-year total and a 54% year-over-year increase.
Experts attribute cuts to slowing consumer spending, high interest rates, AI-driven automation, and earlier post-pandemic overhiring.

It’s a tough time for many American workers right now.

Layoffs have surged to a five-year high, with over a million people losing their jobs this year alone, according to a fresh report from Challenger, Gray & Christmas.

The numbers paint a picture of an economy that’s cooling off in ways that hit home for families across the country.

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The report shows that U.S. employers announced 71,321 job cuts just in November—a 24% jump from the 57,727 cuts announced in November of the previous year.

That’s the highest for the month since 2022, when 76,835 jobs were slated for elimination.

“Layoff plans fell last month, certainly a positive sign.

That said, job cuts in November have risen above 70,000 only twice since 2008: in 2022 and in 2008,” said Andy Challenger, workplace expert and chief revenue officer for Challenger, Gray & Christmas, in the report.

Digging deeper into the year-to-date figures, employers have announced a staggering 1.17 million job cuts through November.

That’s a 54% increase from the 761,358 announced in the first 11 months of 2024.

This marks the highest level since 2020, when the pandemic triggered massive disruptions, and it’s only the sixth time since 1993 that cuts have topped 1.1 million by this point in the year.

Here’s Why This Data is Significant

These aren’t just abstract numbers—they’re affecting real people at a time when economic confidence is already shaky.

President Donald Trump and Republicans have often highlighted the strength of the economy under GOP policies, but rising layoffs, combined with ongoing affordability challenges, are chipping away at that narrative.

A recent survey from the Federal Reserve Bank of New York found that 38.97% of Americans expect to be worse off financially next year—the highest level since November 2023.

Experts point to a mix of factors driving these cuts.

“Consumer spending is slowing as people grapple with higher costs and stubborn interest rates,” Michael Ryan, a finance expert and the founder of MichaelRyanMoney.com, told Newsweek.

“Companies are betting on AI and automation to do more with less. And a lot of businesses that hired aggressively after the pandemic are simply correcting course.

They overestimated how much staff they’d actually need.”

Ryan added that much of the recent job growth was on unstable footing to begin with. “What we’re seeing now is a structural cooling, not just a temporary sector-specific dip.

It’s widespread, which means it matters to everyone,” he said.

Experts Weigh In on Labor Market and US Layoffs

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The layoffs have sparked a range of opinions from analysts watching the labor market closely.

Alex Beene, a financial literacy instructor at the University of Tennessee at Martin, told Newsweek:

“After years of lower unemployment rates and plentiful jobs in most sectors of the economy, America has in the past year seen numerous cracks in that sturdy wall, but it’s too early to tell if the fissures being created are permanent.

Obviously, AI is the source of most of the finger-pointing when it comes to some of the employment cutbacks, but it’s important to note demand for products and services in many sectors have fallen in the last year, as well.”

On the personal finance side, Ryan emphasized the need for preparedness: “If you work, job security is shakier than it’s been in years, even in fields that have historically weathered downturns.

That makes flexibility and constant learning non-negotiable. You also need a real financial cushion. Not someday, now! If you’re managing household finances, planning just got harder.

When both your paycheck and your housing costs feel uncertain, the old advice to avoid over-leveraging and keep cash on hand suddenly feels urgent rather than cautious.”

HR consultant Bryan Driscoll offered a perspective tied to policy shifts:

“These layoffs signal uncertainty. Companies are pulling back because they’re bracing and reacting to the ripple effects of Trump’s policies and rhetoric.

In business, when you’re not growing, you’re retreating, and when you retreat, that means cutting staff.

So we’ve got this weird split where the labor market is still creating some jobs, but employers are acting like a downturn is already here.”

Kevin Thompson, CEO of 9i Capital Group and host of the 9innings podcast, told Newsweek:

“Some say it’s payback from the pandemic where companies that held on to workers and got government support are now trimming the fat. Others see it as a response to uncertainty.

When things feel shaky, the first move for many businesses is to cut overhead.”