December Layoffs Reach 17-Month Low
The number of planned layoffs in December dropped to the lowest level seen in 17 months, suggesting a potential stabilization in the labor market following a wave of significant job cuts earlier this year.
According to a report from Challenger, Gray & Christmas, U.S. employers announced a total of 35,553 layoffs in December. This marks a 50% decrease compared to November and an 8% drop from the same time last year, making it the lowest monthly figure since July 2024.
Andy Challenger, the chief revenue officer at Challenger, commented, “This year ended with the fewest announced layoff plans of any year. December is typically a slow month for layoffs, but when paired with an uptick in hiring plans, it indicates a positive shift after a year filled with substantial job losses.”
Despite the decline in December, the cumulative job cuts for 2025 have reached 1.2 million, an increase of 58% from the 761,358 layoffs recorded in 2024. This level of job cuts is the highest since the pandemic in 2020.
The reported layoffs in the last quarter of 2025 were the worst since the 2008 financial crisis, totaling 259,948 planned layoffs.
This year, the government sector experienced the most layoffs, particularly after significant job cuts initiated by Elon Musk’s Department of Government Efficiency (DOGE) early in the year.
In the first quarter alone, an impressive 279,445 government job cuts were announced, with an additional 28,722 laid off in the following nine months.
Technology companies also contributed with 154,445 layoffs in 2025, which Challenger attributed to advancements in artificial intelligence and a surge in overemployment over the last decade.
Other sectors, namely warehousing, retail, and services, faced considerable challenges as they navigated economic uncertainties related to supply chain disruptions, automation, rising prices, and tariffs.
The media industry documented 17,163 job cuts in 2025, reflecting a 15% rise compared to 2024. Notably, planned layoffs in December for this sector weren’t documented.
The primary reasons for job cuts this year included the aforementioned DOGE layoffs, store closures, unfavorable economic conditions, and restructuring efforts. Additionally, AI accounted for 54,836 reductions, alongside 7,908 layoffs attributed to tariffs.
On a more optimistic note, American companies announced plans to hire 10,496 people in December, which is an increase of 31% compared to the previous year.
Analysts have been closely monitoring private sector reports, such as Challenger’s, especially after a government shutdown last year complicated the country’s economic data.
The Challenger report mentions notable layoffs at the onset of 2025, yet the weekly new jobless claims have remained relatively steady throughout the year.
Recently, the number of Americans filing for new unemployment benefits slightly rose to 208,000. The Labor Department noted that the four-week moving average of these applications is the lowest it has been since April 27, 2024.
While initial claims haven’t surged, the count of Americans unemployed for six months or longer increased to 1.9 million in November, up from 1.7 million a year prior.
Moreover, employment statistics are lagging, with average monthly job growth standing at just 55,000 throughout 2025; December’s job growth is anticipated to be around 73,000.
The unemployment rate hit 4.6% in November, the highest since September 2021, and wage growth has slowed to its slowest pace since before the pandemic.
