Layoff and employment rates have remained low in recent months. That may be starting to change, and not in a good way.
Layoffs announced last month were the highest for January since 2009, according to a report released Thursday by global outplacement firm Challenger, Gray & Christmas. This is consistent with the nationwide trend of job cuts.
U.S.-based employers announced 108,435 layoffs last month, a 118% increase from the 49,795 layoffs announced in January 2025 and a 205% increase from the 35,553 layoffs announced in December, according to the Challenger report, which is based on corporate layoff announcements.
The report also noted last month that employment levels in January were the lowest since 2009. The official January jobs report from the Bureau of Labor Statistics will be released next week after delays caused by the brief government shutdown. The previous BLS report showed that U.S. job openings fell to a five-year low in December.
Experts say the overall employment situation remains relatively strong, considering indicators such as the unemployment rate. But this situation does not reflect how people feel in the job market, and Challenger’s findings may be indicative of broader problems in job growth.
In a stagnant job market, layoffs are increasing without a corresponding increase in employment. So even though the number of layoffs is close to pre-COVID-19 levels, workers are fearful of losing their jobs because the downturn in employment could make it more difficult to find another job, said Daniel Chao, chief economist at Glassdoor.
“Worker anxiety about being fired is clearly on the rise, even if it doesn’t tend to match up one-to-one with hard data,” Zhao said.
The year started with some high-profile mass layoff announcements. Last Wednesday, Amazon announced its largest round of layoffs in its history, affecting 16,000 employees, on top of an additional 14,000 layoffs in October. UPS has announced that it plans to cut up to 30,000 jobs this year as its largest customer, Amazon, expects the number of deliveries to decline.
Mr. Zhao said that while the spike in layoff announcements was “attracting attention,” “the data suggests that the increase in layoffs is becoming more subdued.”
The unemployment rate is still considered healthy at around 4%, but it will gradually rise until 2025, hitting 4.6% in November, the highest level in four years. Regarding employment growth, non-farm payrolls fell sharply in October, marking the third net negative growth in six months, but November’s growth was slightly higher than expected.
In the midst of this employment situation, job seekers and workers are feeling anxious. Workers’ confidence in their ability to find another job fell to an all-time low of 44.9% in September.
Despite the high-profile layoffs, “the odds of losing a job haven’t gone up that much,” said Laura Ulrich, director of North American economic research at Indeed Hiring Lab. Currently, most of the layoffs are concentrated in companies that are overhiring, making large investments in AI, or both, he said. Amazon and UPS together accounted for more than 40% of January’s reductions announced in the Challenger Report.
The layoffs in the technology and logistics industries follow a huge boom in business in these sectors during the pandemic, with many companies ramping up hiring. “Part of this is still about modifications from that period,” Ulrich said.
She says these sectors can best be described as “low jobs and low layoffs,” but the overall macro environment remains one of low hiring and low layoffs.
Even big numbers like recent company announcements don’t necessarily reflect the details of an employer’s plan. “It is not unusual to receive forward-looking statements from companies in the first month of the year as they close out their previous fiscal year,” Zhao said. Some companies like UPS are “talking about plans for layoffs and layoffs that are planned for later this year, but all of that is not the same as more typical layoffs,” he noted.
Despite this, many workers feel stuck in their jobs due to lack of employment and fear of layoffs.
“Even if the unemployment rate is a relatively healthy number and people’s employment is at a relatively healthy level, that doesn’t mean people have to be satisfied with their current jobs,” Zhao said.
Confidence among job seekers continues to be low and hiring rates continue to be low, which may be causing people to continue looking for jobs. “People are holding back because they’re really feeling this disruption,” Ulrich said. “There’s a lot of uncertainty.”
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