In a mixed bag of news for the U.S. labor market, job cuts dropped in September but hiring plans hit a 15-year low, raising concerns about where the economy is headed next.
According to Challenger, Gray & Christmas, employers announced 54,064 job cuts last month, a 37 percent decrease from August and 26 percent lower than September 2024. It marks only the third time this year that monthly cuts have fallen below the year-before level.
Despite the dip, layoffs for the year remain high, totaling 946,426 so far. That’s the most since 2020, when over two million positions were cut during the early pandemic chaos.
“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,” said Andy Challenger.
But here’s the real warning sign: hiring plans are fading fast. Employers only planned to add around 205,000 jobs through the first nine months of 2025, a steep 58 percent drop from the same period in 2024 and the weakest level since 2009.
“Right now, we’re dealing with a stagnating labor market, cost increases, and a transformative new technology,” Challenger added.
The ADP report added more pressure, showing private employers cut 32,000 jobs in September and revising August’s gains to a small loss.
With the official September jobs report likely delayed due to the government shutdown, all eyes are on the Fed. Traders are already banking on another rate cut later this month, hoping it might thaw the hiring freeze.
