U.S. employers announced fewer job cuts in September, but hiring plans fell to their lowest level since 2009, underscoring uncertainty in the labor market, according to a Thursday report.

Companies announced 54,064 job cuts last month, down 37 percent from August and 26 percent lower than the same month a year earlier, outplacement firm Challenger, Gray & Christmas said. It was only the third time this year that cuts came in below the same month a year earlier.

Still, employers have announced 946,426 job reductions so far this year — the highest since 2020, when more than 2 million cuts were announced.

“Previous periods with this many job cuts occurred either during recessions or, as was the case in 2005 and 2006, during the first wave of automations that cost jobs in manufacturing and technology,” Andy Challenger, senior vice president and labor expert for Challenger, Gray & Christmas, said in the report.

On the hiring side, the situation looks bleak. Employers have announced plans to add about 205,000 jobs through the first nine months of the year — down 58 percent from the same point in 2024 and the lowest tally since 2009.

The latest figures highlight what analysts call a “no-hire, no-fire” labor market: limited opportunities but so far, relatively few layoffs.

Challenger’s report comes as official government data is paused due to the federal shutdown. The Bureau of Labor Statistics’ (BLS) September jobs report will likely not be released as scheduled on Friday.

The government report is considered the gold standard for labor market data, but economists and policymakers are left flying in the dark, relying on alternative data sources to gauge the economy.

“Right now, we’re dealing with a stagnating labor market, cost increases, and a transformative new technology, ” Challenger said. “With rate cuts on the way, we may see some stabilizing in the job market in the fourth quarter, but other factors could keep employers planning layoffs or holding off hiring.”

A separate report this week from payroll-processing firm ADP showed the U.S. shed 32,000 private-sector jobs in September. Even more concerning, its August estimate was revised down from a gain of 54,000 to a loss of 3,000.

“This month’s release further validates what we’ve been seeing in the labor market, that U.S. employers have been cautious with hiring,” said ADP chief economist Nela Richardson.

The ADP report can differ significantly from the government’s figures, so economists often take it with a grain of salt.

Still, the weak private jobs data has traders more confident the Federal Reserve will continue to slash interest rates, pricing in a 98 percent chance of a quarter-point reduction later this month, according to the CME FedWatch tool.

The Fed lowered rates in September for the first time this year to bolster the labor market, even as inflation remains above its 2 percent target.

The Consumer Price Index for September is scheduled for release Oct. 15, but depending on when the shutdown ends, that, too, could be delayed.