(TNS) – Job cuts have so far surpassed 2024 total so far this year, as government costs cuts, economic uncertainty and AI have led employers to cut staff.
California and the tech industry are particularly big hits, according to a report from Challenger, Gray & Christmas on Thursday.
Companies from August to August announced cuts of approximately 892,000. This is 66% more than a year ago, already surpassing the 2024 total. The last tally cut was in the middle of the 2020 Covid-19 lockdown.
The Trump administration's initiative to cut government spending was the biggest culprit for significantly reducing government work through what it called government efficiency (also known as Doge), but economic concerns and technological changes weighed in areas such as technology, finance, and retail.
“After the federal impact of DOGE, employers have cited economic and market factors as drivers for layoffs,” challenger Andrew Challenger, senior vice president and labor expert at Gray & Christmas, said in a statement.
California was the state with the most cuts, with Washington, DC alone
This year's cuts in California increased 24% to 135,241. Washington tripled the cut to 294,696. Job cuts rose 33% in New York, but in some states, including Texas and Nevada, this has declined.
Challenger, Gray & Christmas offers outplacement services and executive coaching, collecting data from news reports, company applications, annual reports, news releases and layoff notifications. Track job cuts by company headquarters unless the announcement includes a layoff location.
The report is the latest to get a glimpse into the brutal job market facing workers as layoffs continue across a variety of industries, including healthcare and technology. In August, pharmaceutical companies, financial companies, nonprofits and retailers saw a major clash in job openings.
“Retailers have been hit hard by tariffs, inflation and continued economic uncertainty, causing bankruptcy and closures,” Challenger said. “If tariff and consumer spending constraints arise, the approaching holiday shopping season can see fewer seasonal employment and actually high layoffs.”
Last month, retailers such as Kroger announced that they had filed for bankruptcy by Claire's on a massive job cut selling accessories at shopping malls.
Meanwhile, the rise of artificial intelligence chatbots that can generate text and code can increase workers' anxiety and ultimately become automated.
This year, artificial intelligence was cited as a reason for a job cut of 10,375 people, the report said. The technology update, including AI, probably helped cut jobs by 20,219 people.
According to the report, tech companies announced 102,239 jobs cut this year, down 3% from last year.
Intel, Microsoft, Meta and Salesforce are among the high-tech companies that have cut their workforce this year and invested heavily in AI.
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