Key facts
- US employers announced 97,006 job cuts in May.
- This is a 16% increase from April's 83,387 job cuts.
- May's total is the highest for the month since 2020.
US employers announced 97,006 job cuts in May, a 16% increase from April and the highest total for the month since 2020. This marks the third consecutive month of rising layoffs, with AI cited as a leading reason for cuts in the tech sector.
Global outplacement firm Challenger, Gray & Christmas reported that U.S. employers announced 97,006 job cuts in May. This figure represents a 16% increase from the 83,387 job cuts recorded in April and a 3% increase from the 93,816 announced in May of the previous year. The May total is the highest for the month since 2020, when 397,016 job cuts were recorded at the height of the pandemic. This marks the third consecutive month of rising layoffs, climbing from 48,307 in February. Year-to-date, employers have announced 397,755 cuts, down 43% from the same period in 2025, though 2026 is running roughly even with 2024 when adjusted for federal workforce reductions. Andy Challenger, labor and workplace expert at Challenger, Gray & Christmas, noted a sharp rise in cuts tied to acquisitions, mergers, and bankruptcies, suggesting aggressive restructuring for an AI-driven economy. The report also highlights AI as the leading reason for cuts for the third month in a row.
The rising trend in layoff announcements, particularly those linked to AI and corporate restructuring, suggests potential headwinds for economic growth and may challenge the narrative that AI will solely spur job creation. This data could influence Federal Reserve policy decisions regarding interest rates.