Job Cuts Have Jumped 47% Year-Over-Year, According to New Report

Job cuts in the U.S. increased 47% in May compared to the same month last year. According to a report from Challenger, Gray & Christmas, a business and executive coaching firm, companies eliminated 93,816 jobs last month compared to 63,816 in May 2024.

For the first five months of 2025, employers cut a total of 696,309 jobs. The figure represents an 80% surge over the same period last year, which only had 395,859 job losses.

“Tariffs, funding cuts, consumer spending, and overall economic pessimism are putting intense pressure on companies’ workforces,” said Andrew Challenger, senior vice president of Challenger, Gray & Christmas. “Companies are spending less, slowing hiring, and sending layoff notices.”

Market and economic reasons were the main drivers of the job cuts, responsible for 131,257 workforce reductions from January to June. Store, division, and factory closings were responsible for 94,439 terminations.

Company restructuring caused 62,015 layoffs, while bankruptcy filings forced 35,501 employees out of a job. Federal government layoffs, including independent contractors, reached 284,044 through May 2025.

Retail and Service Impacts of Job Cuts

U.S. retailers cut 11,483 jobs in May, bringing the total to 75,802 in the first five months of 2025. For the same five-month period last year, the job eliminations were significantly fewer at only 20,276.   

In the services sector, job cuts amounted to 22,492 last month. This represents the highest figure since 34,229 jobs disappeared in May 2020.  

Tech jobs were also hit hard in May as technology continues to shift and disrupt across industries. There were 10,598 job reductions last month, with a total of 74,716 cuts from the first of the year. Last year during the same period, 55,207 jobs vanished. According to the report, AI has led to 20,000 fewer jobs so far in 2025.

Hiring in 2025

While layoffs are reportedly up, so is hiring. As of May 2025, U.S. companies intend to bring on 79,741 new employees, a 57% increase from the 50,833 planned hires last year. While this is good news, the uptick is still lower than in recent years.

“The current 2025 hiring pace is more aligned with 2012 (50,194 YTD) and 2013 (180,012 YTD) than with the rebound years of 2021–2022, suggesting that, while companies are adding workers, they are doing so cautiously,” explained Challenger.