Layoffs in the U.S skyrocketed in October to their worst monthly level for 22 years, with Americans now facing the type of job cuts typically seen during recessions.
Despite President Donald Trump repeatedly touting that the US economy “has never been hotter,” a new report has fueled concerns about a labor market slowdown with more people out of work.
The data, according to outplacement firm Challenger, Gray & Christmas, shows that company layoffs soared last month to more than 153,000, marking the worst October for job reductions since 2003.
US employers have also announced 1.1 million layoffs so far this year – the biggest number of layoffs since the pandemic and on par with job cuts during the global financial crisis.
Trump, however, took a victory lap on the economy on the one-year anniversary of his successful election on Wednesday.
Speaking at the America Business Forum in Miami the day after Republicans were rebuked at elections across the country, the president said the U.S. was the envy of the world.
“We have the greatest economy right now,” he declared, adding that “a lot of people don’t see that.”
The report shows that the labor market has shifted from one where workers had job security even though their bosses weren’t hiring as much, to one where more companies are cutting costs and reducing staff as they replace humans with AI.
Amazon, for instance, announced 14,000 job cuts this week, citing a shift toward AI.
“October’s pace of job cutting was much higher than average for the month,” said Andy Challenger, chief revenue officer for Challenger, Gray & Christmas.
“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.
“Those laid off now are finding it harder to quickly secure new roles, which could further loosen the labor market.”
The numbers are politically sensitive for Trump because they undercut one of the administration’s central claims – that it has restored economic confidence and “brought jobs back.”
Federal Reserve Chair Jerome Powell also cited concerns about slower hiring in announcing interest rate cuts in September and October.
While Trump continues to talk up the economic landscape under presidency, Democratic victories in coast-to-coast elections this week suggest many voters are not feeling as confident.
In Virginia, for instance, which has a high number of federal workers, former Congresswoman Abigail Spanberger rode to victory in part due to anger over job cuts and the government shutdown.
In New Jersey, New York and Pennsylvania, Democrats also defeated their opponents by talking about economic and cost-of-living pressures.
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