‘This is the highest total for October in over 20 years’
The American labour market is showing clear signs of strain as recession-level layoffs sweep across industries, with October marking the highest number of job cuts for the month in over 20 years.
U.S.-based employers announced 153,074 job cuts in October—an alarming 175% increase from the same month last year and up 183% from September, according to a new report from Challenger, Gray & Christmas.
This brings the year-to-date total to 1,099,500 announced layoffs, the highest since the pandemic-driven cuts of 2020 and a 65% jump over the first 10 months of 2024.
“October’s pace of job cutting was much higher than average for the month,” said Andy Challenger, chief revenue officer at Challenger, Gray & Christmas.
“Some industries are correcting after the hiring boom of the pandemic, but this comes as AI adoption, softening consumer and corporate spending, and rising costs drive belt-tightening and hiring freezes. Those laid off now are finding it harder to quickly secure new roles, which could further loosen the labor market.”
‘Highest total in over 20 years’
Artificial intelligence is increasingly cited as a driver of layoffs, responsible for 31,039 job cuts in October and nearly 50,000 so far this year, said the report.
October’s total is the highest for the month since October 2003, when 171,874 cuts were recorded. That month, large announcements occurred in retail due to acquisitions and in telecommunication as cell phones gained wide adoption.
“This is the highest total for October in over 20 years, and the highest total for a single month in the fourth quarter since 2008. Like in 2003, a disruptive technology is changing the landscape,” said Challenger.
Cost-cutting remains the top reason for job reductions, with over 50,000 layoffs attributed to this factor last month. Broader market and economic conditions, as well as plant and store closures, also contributed significantly to the surge in job losses.
Technology, warehousing lead job cuts
The technology sector remains at the forefront of layoffs, with 33,281 job cuts announced in October alone—nearly six times the number in September, said the report. For the year, tech firms have slashed 141,159 jobs, up 17% from the same period last year, as companies restructure amid AI integration and efficiency pressures.
Warehousing also saw a dramatic spike, with 47,878 jobs cut in October, reflecting ongoing automation and overcapacity following pandemic-era expansion.
Retail, services, and consumer products companies are also among the hardest hit, as shifting consumer habits, cost pressures, and store closures continue to reshape the employment landscape, said Challenger, Gray & Christmas.
Notably, non-profits have faced a 419% increase in layoffs this year, largely due to reductions in government funding and rising operational costs.
The Bank of Canada will eliminate roughly one-tenth of its workforce in the coming months, part of a government-wide effort by Prime Minister Mark Carney’s administration to curb public spending and reduce long-term costs.
Hiring slows to post-recession lows
While layoffs accelerate, hiring plans have slowed to levels not seen since 2011. U.S. employers have announced just 488,077 planned hires through October, down 35% from last year.
Seasonal hiring is especially weak, with the lowest number of announced positions since Challenger began tracking the data in 2012.
Canada’s job market is showing signs of stabilization, with hiring demand holding steady and wage growth continuing to slow, according to a new report from RBC Economics.
A separate report from payroll processor ADP shows private employers added just 42,000 jobs in October, a modest rebound after two months of weak hiring. However, the gains were concentrated in education, health care, and trade, while professional services, information, and leisure sectors continued to shed jobs.
“Private employers added jobs in October for the first time since July, but hiring was modest relative to what we reported earlier this year. Meanwhile, pay growth has been largely flat for more than a year, indicating that shifts in supply and demand are balanced,” said Nela Richardson, ADP’s chief economist.
