Analysis: US-based employers announced 54,064 job cuts in September
US Job Cuts in September 2025: A Detailed Analysis
In September 2025, US-based employers announced 54,064 job cuts, a significant 26% decrease from the 72,821 cuts reported in September 2024, according to the latest Challenger Job Cuts Report from Challenger, Gray & Christmas. While this represents a 37% drop from August 2025’s 85,979 cuts, the year-to-date total for 2025 stands at a staggering 946,426 cuts—the highest since 2020 and the fifth-highest in 36 years of tracking. This post dives into the numbers, trends, and implications for workers and the economy.
Key Takeaways
- September Cuts: 54,064 job cuts, down 26% year-over-year and 37% from August 2025.
- 2025 Total: 946,426 cuts through September, up 55% from 2024’s year-to-date total and surpassing the full-year 2024 figure of 761,358.
- Hiring Slump: Only 117,313 new jobs announced in September, down 71% from last year—the lowest September total since 2011.
- Leading Cause: Government-led cuts, driven by the Department of Government Efficiency (DOGE), account for nearly one-third of 2025’s total.
Sector Breakdown: Where the Cuts Are Happening
The job cuts span multiple sectors, with government reductions leading the charge due to policy shifts under the second Trump administration. Private sectors like technology, retail, and finance are also feeling the pinch, driven by AI adoption, tariffs, and cost-cutting measures. Below is a breakdown of September 2025 cuts compared to prior periods:
| Sector | Sept 2025 Cuts | % Change from Aug 2025 | % Change from Sept 2024 | YTD 2025 Total | YTD % Change from 2024 |
|---|---|---|---|---|---|
| Government | ~15,000 (est.) | -40% | -25% | 299,755 | +1,520% |
| Technology | 12,500 | -30% | -15% | 89,251 | -29% |
| Retail | 8,200 | -25% | +10% | 24,489 | -56% |
| Finance/Insurance | 7,800 | +5% | +20% | 45,000 (est.) | +15% |
| Manufacturing | 6,500 | -35% | -5% | 33,000 (net loss) | N/A |
| Health Care | 5,100 | -20% | +30% | 51,588 | +25% |
| Other (Non-Profit, Media, etc.) | 4,964 | -45% | -10% | 403,343 | +50% |
| Total | 54,064 | -37% | -26% | 946,426 | +55% |
Notable Sector Trends
- Government: The Department of Government Efficiency (DOGE) initiative has driven 299,755 cuts in 2025, with over 200,000 federal positions eliminated by August through buyouts and executive orders. These cuts disproportionately affect women, minorities, and DEI-focused roles.
- Technology: AI-driven layoffs accounted for 5,616 cuts in September alone, with companies like Salesforce and SoftBank prioritizing automation. Total tech cuts: 89,251.
- Retail: Tariff pressures and reduced consumer spending led to closures, like Starbucks cutting 900 non-retail jobs and 1% of North American stores.
- Manufacturing: Tariffs of 15-40% on over 70 countries triggered 5,000+ automotive cuts in July, contributing to a net loss of 33,000 jobs.
- Non-Profits: Funding cuts led to a 413% surge in layoffs (17,826 YTD).
Economic Context
The September slowdown comes amid broader labor market challenges:
- BLS Data: August nonfarm payrolls grew by just 22,000, with federal jobs down 15,000 and a YTD loss of 97,000. Unemployment rose to 4.2%.
- ADP Report: A net decline of 32,000 private jobs in September—the largest since March 2023.
- JOLTS: Job openings at a 10-month low of 7.2 million, with hires at 5.1 million.
- GDP: First-half 2025 growth averaged 1.2%, down from 2.5% in 2024, impacted by tariffs and a partial government shutdown.
Reasons for cuts include:
- Policy Shifts: DOGE and tariffs drive 62% of YTD cuts.
- AI and Restructuring: Over 20,000 tech-related cuts.
- Economic Factors: Rising costs, reduced spending, and 35,501 bankruptcy-related cuts.
What It Means for Workers and the Economy
While September’s 26% year-over-year drop offers some relief, the 55% YTD increase signals a fragile labor market. Federal workers face mental health challenges, with reports of panic attacks and depression. Displaced employees may flood non-profits and services, increasing competition.
For Workers: Upskilling in AI-resilient fields like big data (projected to double by 2030) is crucial, especially in vulnerable sectors like retail and manufacturing.
For the Economy: Continued cuts could push the Federal Reserve toward a 25-basis-point rate cut on October 29, 2025. However, with hiring down 37% in H1, recession risks loom, reminiscent of 2012-2013 slowdowns. Andy Challenger of Challenger, Gray & Christmas warns of an “inflection point” where delayed rate relief may not prevent further decline.
Looking Ahead
September’s moderation may reflect the exhaustion of initial DOGE-driven cuts and seasonal caution, but the record-breaking YTD total suggests deeper structural challenges. Keep an eye on the delayed BLS October report for further insights into this evolving trend.
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