US job crisis deepens: 806,000 layoffs so far in 2025, worst since COVID crash - Is your company next on the chopping block?

Jobs report: There will be big changes in the American job market this year. There have been more mass layoffs in all industries, and in 2025 alone, more than 800,000 people lost their jobs. This is the worst start to a year for jobs since the economy fell apart because of COVID-19.

No industry seems to be safe, from tech to retail. Technology, retail, and government sectors lead the pack, with AI and federal budget cuts driving much of the disruption.

Outplacement firm Challenger, Gray, and Christmas reported Thursday that U.S.-based employers announced 62,075 job cuts in July, up 29% from June and 140% from 25,885 in July 2024.


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Why are job cuts spiking across industries?

Employers have announced 806,383 layoffs so far this year, the most since 2020, when COVID caused economic disruption. Compared to 460.5K job cuts in the first seven months of 2024, the year-to-date total is up 76%.

Compared to the average of 23,584 job cuts since the pandemic, the July cuts are significantly higher.

According to Andrew Challenger, senior vice president of Challenger, Gray & Christmas, "we
are seeing the federal budget cuts implemented by DOGE impact non-profits and healthcare in addition to the government." "AI was cited for over 10,000 cuts last month, and tariff concerns have impacted nearly 6,000 jobs this year," as per a report by Seeking Alpha.

In terms of hiring, American companies anticipate adding 86,132 positions through July 2025, compared to 73,596 during the same time last year. With 28,190 new positions announced, nearly a third of the hiring plans were in the entertainment and leisure sector.

In terms of industry-specific job cuts, government organizations accounted for 3,666 layoffs in July, compared to 3,801 in June.

Which sectors have been hit hardest by layoffs?

Out of all sectors, job cuts totalled 292,294 so far this year. With 89,251 layoffs so far in 2025, a 36% increase from the same period in 2024, technology is the sector most responsible for the private sector's job losses.

Compared to the same period last year, retail announced 80,487 job cuts through July, a 249% increase. Compared to the same period last year, nonprofits announced 17,826 job cuts in the first seven months of this year, a five-fold increase.

The job crisis in the United States is getting worse. In 2025, there were more than 806,000 layoffs, the most in a single year since the COVID pandemic. In July, there were 29% more job cuts than in June. The technology, retail, and government sectors are the most affected, with AI and cuts to the federal budget being two of the main causes.

FAQs

What industries will have the most job cuts by 2025?
This year, the technology, retail, government, and non-profit sectors have seen the most layoffs.

How many job cuts have been attributed to AI?
In the last month alone, AI-driven changes have resulted in the loss of over 10,000 jobs.