US companies announce most October Job Cuts in over 20 years

US companies announced the most job cuts for any October in more than two decades as artificial intelligence reshapes industries and cost-cutting accelerates, according to data from outplacement firm Challenger, Gray & Christmas Inc.

Companies announced 153,074 job cuts last month, almost triple the number during the same month last year and driven by the technology and warehousing sectors. It’s the most for any October since 2003, when the advent of cellphones was similarly disruptive, said Andy Challenger, the company’s chief revenue officer.

“Some industries are correcting after the hiring boom of the pandemic, but this comes as AI adoption, softening consumer and corporate spending, and rising costs drive belt-tightening and hiring freezes,” Challenger said in the report. “Those laid off now are finding it harder to quickly secure new roles, which could further loosen the labor market.”

The numbers are weak no matter how they’re spliced. Year-to-date job cuts have exceeded 1 million, the most since the pandemic. In the same period, US-based employers have announced the fewest hiring plans since 2011. Seasonal hiring plans through October are the lowest since Challenger started tracking them in 2012.

“It’s possible with rate cuts and a strong showing in November, companies may make a late season push for employees, but at this point, we do not expect a strong seasonal hiring environment in 2025,” said Challenger.

In recent weeks, Target Corp. announced plans to eliminate 1,800 roles, or about 8% of corporate jobs in its first major restructuring in years. Amazon.com Inc. said it would slash 14,000 corporate jobs — following a warning from its CEO that AI will shrink the company’s workforce — while Paramount Skydance Corp. axed 1,000 workers. Other companies cutting corporate jobs include Starbucks Corp., Delta Air Lines Inc., CarMax Inc., Rivian Automotive Inc. and Molson Coors Beverage Co., which cut about 9% of its salaried workforce.

The companies’ reasons vary. United Parcel Service Inc. said last month that it has culled its operational workforce — which includes delivery drivers and package car handlers — by 34,000, about 70% more than it previously projected earlier this year. The package handler cited increased use of automation, which has driven up productivity.

Others are focused on removing layers of management, reducing the hangover from the pandemic-fueled hiring bloat and protecting profit margins from the added costs of tariffs. While many expected increased levies to drive up prices, many employers have absorbed the price increases and instead chosen to cut costs from labor and other parts of their businesses.

Mounting job-cut announcements risk fueling concerns about the health of the labor market just as newly unemployed Americans are facing a diminished hiring environment. The figures could also be viewed at odds with Federal Reserve Chair Jerome Powell’s recent characterization that there’s only a “very gradual cooling” in the job market.

JPMorgan Chase & Co. Chief Executive Officer Jamie Dimon echoed Powell’s sentiment. He said headcount at the largest US bank will probably remain steady or rise as it continues to roll out artificial intelligence, if “we do a good job.” Dimon said the bank would redeploy workers whose jobs were impacted by the technology. AI will reduce human workloads in many roles, but “it will also create jobs,” he said in a recent interview with CNN.

Read More: Companies to Publicly Report AI Job Loss Under Bipartisan Bill

Payrolls at US companies increased by 42,000 in October after two straight months of declines, signaling some stabilization while consistent with a general softening in labor demand, ADP Research data showed Wednesday.

Separate data out Thursday from Revelio Labs showed US overall employment fell about 9,000 in October, largely reflecting a decline in the government sector. Smaller decreases were noted at manufacturers, retailers and wholesalers, while education and health services led those industries increasing employment.

Data from the workforce intelligence firm also showed an increase in the number of employees who were issued layoff notices last month. Those figures are drawn from so-called WARN notices that require companies with at least 100 workers to issue advance notice of plans to lay off at least 50 employees.