July Layoffs Fall to Lowest Level in Two Years
Employers announced 33,429 job cuts last month, down 46% from a year earlier, even as artificial intelligence remained the leading stated reason for layoffs.
Layoffs announced by U.S. employers fell in July to their lowest level in two years, new data shows, a sign that the labor market remains resilient.
Employers announced 33,429 job cuts last month, down 46% from a year earlier, according to the outplacement firm Challenger, Gray & Christmas. That was the lowest monthly total since July 2024, when roughly 26,000 cuts were announced.
Weekly unemployment filings point in the same direction. The four-week average of initial jobless claims has fallen below 200,000 for the first time since October 2022, according to PNC Economics Research.
"The pace of layoffs fell dramatically this summer," Andy Challenger, workplace expert and chief revenue officer at Challenger, Gray & Christmas, said in a statement. "Layoff plans continue to be announced primarily in tech, and artificial intelligence is still the story, as investments in the technology reshape organizations."
AI has been the leading cause of announced job cuts for five straight months, according to Challenger, accounting for 33% of layoffs in July. Economists note that those cuts remain largely concentrated in the technology industry.
"Recently laid-off workers are finding jobs as fast as the economy is creating new ones," Carl Weinberg, chief economist at High Frequency Economics, said in a research note. "That suggests the labor market is still balanced."
While employers have held back from cutting staff, hiring remains modest. Government data shows the number of job openings nationwide is steady but still below its pre-pandemic level.
The Labor Department is scheduled to release July hiring figures on Friday. Economists polled by FactSet forecast a gain of 97,500 jobs. Employers added only 57,000 jobs in June, weaker than forecasters had expected.
The unemployment rate, at 4.2%, is low by historical standards, but some groups report difficulty finding work. Amid rising corporate investment in AI, competition for entry-level corporate roles traditionally open to recent college graduates has intensified: the number of applications per job has surged 30%, according to the career platform Handshake.
This article was produced with the assistance of artificial intelligence (AI), in accordance with our editorial policy.
