Job Cuts Surge Past 1.1 Million, Marking Highest Level Since Pandemic

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(NewsNation) — This year, U.S. companies have revealed plans to cut over 1.1 million jobs, marking the highest reduction since the year 2020, as per recent figures from Challenger, Gray & Christmas.

The outplacement firm highlighted that this number represents a 54% increase compared to the first 11 months of the previous year. Notably, it is only the sixth occasion since 1993 where the job cuts have surpassed 1.1 million by the end of November.

In November alone, employers announced 71,321 layoffs. Although this figure is more than 50% lower than October’s numbers, it remains the most significant total for November since 2022.

“The decrease in layoff announcements last month is certainly encouraging,” commented Andy Challenger, chief revenue officer at Challenger, Gray & Christmas. However, he pointed out that it is uncommon for November layoffs to exceed 70,000, a mark that has only been surpassed twice since 2008.

Verizon’s plan to cut more than 13,000 jobs helped push November’s total higher. Tech companies also continued to make cuts, announcing 12,377 last month and bringing the year’s total to more than 153,000.

Restructuring was the most common reason cited for November’s cuts, but AI has also been a notable factor, with nearly 55,000 job-cut announcements tied to the technology this year.

Challenger, Gray & Christmas’s monthly report has drawn more attention recently due to the gap in federal labor data resulting from the government shutdown.

The Labor Department isn’t releasing a full October jobs report, and November’s data is scheduled to arrive more than 10 days late.

A separate report this week from payroll processor ADP found that private employers shed 32,000 jobs in November, a larger drop than analysts expected. Even more concerning: small businesses led the decline, shedding 120,000 jobs.

Markets currently see an 87% chance the Federal Reserve cuts rates by a quarter-point at its upcoming meeting, according to the CME FedWatch Tool — reflecting expectations that policymakers will move to bolster a softening labor market.

The most recent official jobs data from September showed employers added a surprising 119,000 jobs. Still, the unemployment rate ticked up to 4.4%, the highest level since October 2021.