What Are We Learning About Employment Today?
A new report from consulting firm Challenger, Gray & Christmas revealed US employers announced more than 1.1 million layoffs so far in 2025. That’s the most since during COVID pandemic in 2020.
And perhaps surprisingly, it’s the tech sector that’s seeing the greatest carnage. CGC reports that technology companies continue slash staff, announcing 12,377 layoffs last month alone (November). Those firms cut 153,000 job cuts so far this year +17% vs 12 months ago.
What are We Learning about Where Employment is Headed?
It seems clear that AI and automation technology are creating big changes in the employment sector. US companies are clearly on board about gaining the benefits of high technology and replacing costly, low-productivity workers with AI solutions. And AI is improving fast. It could be we’re only seeing the tip of an iceberg that will melt fast, perhaps leaving workers abandoned in deep water.
This isn’t meant to be a dark look at the US economy but rather, a realistic view of the next 5 years. Changes are coming too fast, with little preparation from debt-burdened governments who themselves suffer significant cost overruns. The issue of budget deficits even part of this discussion.
Can US Workers be Fully Retrained for High Tech Roles?
Millions of US workers will need extensive retraining, lacking the education or skillset relevant to jobs of the future. The gap between the current job and the next one is concerning. There are no social safety supports to help them bridge that gap. Instead, housing costs and inflation are actually making the outlook dimmer.
And the media may be playing down the negative outcomes of AI unemployment. In the end, corporations want lower costs any way that migh beachieved to keep valuations up. It’s the AI boom, but if the consumer sector with its massive layoffs continue, will AI go bust?
One good sign is a dip in the November layoffs (71,321) which was down from 153,000 cuts in October. But a month does not a trend make. If the US economy does pick up with lower interest rates, reduced taxes, Tariff checks, and even lowered tariffs through trade deals, then the US is the one country likely to arise from the economic ashes.
Any Room for Optimism?
The downward trend shown in the Trading Economics report is nothing to bring joy. Yet, if the lowered interest rate/lower tax benefits materialize in 2026, we might enjoy a big rallying rebound in the employment and a bull market stock market run. Rate cuts are what everyone is waiting for. But will it save the day for everyday working Americans, especially the young and old? It might be more about who will get to participate in future, and about the pain of long term unemployment for many who are replaced by technology. It’s a nagging worry about a future without jobs and how fast that will happen. All governments appear to have no plan to deal with AI-generated unemployment. Universal basic income is posed as a solution, without explanations of where the funding will come from. Unemployed people can’t pay taxes.
Year to Date Layoffs Up 54% vs 2024
Yet the damage is evident: the year-to-date layoffs in the US now total a hefty 1.17 million (+54% year to year comparison). 50+% is nothing to sneeze at. We’re still early in the AI automation adoption curve. And few people really understand how AI technology is being integrated into business and manufacturing. CGC says employers blamed artificial intelligence, tariffs and weakened economic conditions during a time of uncertainty.
Who is Cutting so Many Jobs?
Telecommunication providers announced 15,139 job cuts in November. In 2025, this sector announced 38,035 layoff plans, up 268% from the 10,331 announced during 2024.
Technology companies announced 12,377 in November 153,536 job cuts during 2025, which is up 17% from the 130,701 announced in 2024.
Food companies made 6,708 cuts in November and through 2025 have cut 34,165 jobs, up 26% vs the 27,060 cuts made in 2024.
The Services sector generated 5,509 job cuts in November, up from 1,990 in October. So far this year, the sector has announced 69,089 job cuts, up 64% from the 42,041 executed through November 2024.
Retail companies cut 3,290 job in November, up from 2,431 in October. During 2025, Retail has executed 91,954 job cuts, up 139% from the 38,403 cuts announced during the same period in 2024.
Non-profits announced plans to cut 28,696 this year, up 409% from the 5,640 announced by this point in 2024.
Jobless Claims?
Jobless claims dropped dramatically to lowest level in 25 years reflecting the trend to job hugging perhaps. Still Trading Economics believes this winter will be unkind. Making it puzzling is the rise in holiday spending this year, reflecting optimism, or that the wealthy are still spending.
Challenge Job Cuts — Trading Economics Chart
Each winter period, job cuts increase through to March. It could be consumers and workers are aware of it, and are likely going to cut back hard on spending, as job numbers are released in the next 3 months.
It makes you wonder about a perfect storm brewing. Certainly, the doomsday soothsayers are all over that picture.
Corporate restructuring was the most cited reason for the November layoffs and along with retail store closings. President Trump’s cherished import tariffs are blamed, but the report concludes that they were responsible for only 7,908 layoffs this year, and just 2,000 during November.
ADP Jobs Report for November
New data from ADP reflects what’s continuously wrong with the US economy — Big companies (50+ employees) hired more +(+90,000 workers) while small/micro business declined by 120,000.
- a drop of 74,000 among firms with 20 to 49 employees.
- biggest drop since March 2023.
- professional and business services, which saw a decline of 26,000.
- manufacturing lost jobs (-18,000).
- rate of pay also slowed, with workers staying in their jobs seeing a 4.4% year-over-year increase, down 0.1 percentage point from October.
- workers leaving for a new job saw a 7.2% increase in pay
Big US Monopolies Enjoying the Best of Everything
Big monopolistic companies are enjoying ideal business conditions for themselves while small business suffers the brunt of high interest rates, lack of investment, high taxes, and . Corporate earnings are continuing to support even high stock price valuations and pushing the major indexes back up to record levels. The stock market forecast for the next 3 months may be muted, but the longer term outlook sees better business conditions for US companies and their stocks.
Tom Lee and many other stock market analysts and fun managers still see 2026 as the first year of a big bull market run. So this pain we’re feeling now may be short lived. The talk of J Powell’s termination along with a new FED governor in May is likely boosting the markets beyond what they should be at. It’s dragging valuations up, almost oblivious to what is currently happening.
So investors are looking through binoculars at the 1 to year horizon and liking what they’re seeing and hearing.
Blue collar jobs suffered a setback (-57,000), as consumers cut back spending, and manufacturing and construction has seen a decline.
Sticky inflation, supply channel shortages, high interest rates, and investor caution are keeping the lid on small business recovery. And SMBs have been waiting years for the government to get its house in order, while the major corporations have enjoyed phenomenal investment and profitiability.
A quick look at the types of jobs that are forecast to be in demand going forward reveals a country that’s not healthy. Most deal with mental and physical ill health, which really shows the US is emerging from the Democrat era, not unscathed. Add on massive social costs for immigration and an aging boomer and Gen X population, and funds are pouring into the health care and pharmaceutical sector.
Trump’s Job/Manufacturing Repatriation Plan
The key issue is whether President Trump’s production repatriation plan is working and whether he will modify the tariff/trade situation to spur domestic growth. His and his administration are sitting on the hope that next summer, an America production boom will spur massive employment and earnings gains.
But right now, Trump is delighted with the funds the tariffs are generating through an economy that’s shuffling along. As long as he’s satisfied with that, he won’t feel compelled to resolve the issue. He’s suggesting that lower interest rates will solve the problem in 2nd half 2026, yet experts counter that lower rates might not matter, and that the effects are too late (because of too-late-Powell as Trump calls the FED chair).
Trump appears to be okay with the status quo and he’s hoping the tariff pain will be enough to allow checks to be sent to American citizens, and to force other countries to be fair and equitable in trade.
The key point is that it takes a lot of time to turn a deeply indebted country’s financial situation around. It likely won’t happen until 2027 to get small business rolling again, if Trump sees it as beneficial to his plans.
Currently, he’s focused on big picture issues such as AI domination, energy supremacy, and debt reduction through booming prosperity.
Will the plan work? Leave your thoughtful comment below.
See more on the predictions for the stock market from 3 months to 5 years. Should you buy stocks or sell stocks this winter? Is this market peak the bull run bottom platform? Will we see a crash in January as inflation stays high and job losses begin to mount?
