Published February 6, 2025
U.S.-based employers announced 49,795 cuts in January, up 28% from the 38,792 announced one month prior. It is down 40% from the 82,307 cuts announced in January 2024, according to a report released Thursday from global outplacement and business and executive coaching firm Challenger, Gray & Christmas, Inc.
This is the lowest January job cut total since 2022, when 19,064 cuts were recorded for the month. That month was the lowest total Challenger ever recorded for January.
Source: Challenger, Gray & Christmas, Inc.
“January was relatively quiet in terms of job cut announcements. However, we’ve already seen major announcements in the early days of February, so it seems this quiet is unlikely to last,” said Andrew Challenger, Senior Vice President of Challenger, Gray & Christmas, Inc.
Which Industries Are Cutting Workers?
Technology
Technology led all sectors in job-cutting activity in January with 7,488, up 128% from the 3,287 cuts in the sector one month prior. Technology has been the leading industry for job cuts since 2022, and in that time, these companies have announced 406,679 layoffs, including January’s total.
“Technology firms are being disrupted by AI integration, and many bellwether Tech companies are discussing efficiency and productivity initiatives, which means additional cuts may be coming,” said Challenger.
Source: Challenger, Gray & Christmas, Inc.
Retail
Retail followed with 6,419 job cuts, a 96% increase from the 3,283 cuts announced one month prior. It is up 20% from the 5,364 cuts announced in January of 2024.
“Retailers are coming off a successful holiday season, though in-store traffic fell on main shopping days like Black Friday, according to reports. The Retail job has fundamentally changed, and with automation and online shopping, these positions require different skills than ten years ago,” said Challenger.
Services
Last month, companies in the Services industry announced plans to cut 4,930 jobs, a 106% increase from the 2,392 cuts in the sector in December 2024. It is on par with the 4,817 job cut plans for the industry in January last year.
Automotive
The Automotive sector announced 4,549 job cuts in January, an increase of 123% from the 2,042 cuts announced in the same month one year ago. It is up 90% from the 2,399 cuts announced one month prior.
“The Auto sector is particularly subject to enormous disruptions in tech, as well as consumer preferences with electric or traditional gas cars. Another shift comes from the current administration, which has changed stance on EVs from the previous one. The potential trade war will also profoundly impact Auto makers and their workers,” said Challenger.
Media & News
The Media industry, which includes television, film, streaming, and News, announced 624 job cuts in January, up 27% from the 490 announced in the industry in December. It is down 41% from the 836 cuts announced in the same month last year.
News, which includes digital, broadcast, and print, and is tracked as a subset of Media, announced 192 layoffs in January, down 64% from the 528 News cuts tracked in January a year ago. It is the lowest January total since 2019, when 154 News job cuts were announced.
Where are Companies Cutting?
The West experienced the highest number of layoffs at 19,899, a 19.2% decrease from 24,613 in January 2024. California led the region with 11,862 job cuts, followed by Texas (2,966) and Washington (2,667).
The Midwest recorded 13,908 layoffs, a 8.6% decrease from 15,213 a year earlier. Nebraska reported 4,150 cuts compared to just 13 in January 2024. Michigan (2,923) and Ohio (2,951) also saw significant workforce reductions.
In the East, layoffs totaled 6,889, marking the largest decline among regions with an 81.3% drop year over year: from 36,771 in January 2024. This was largely due to New York, where job cuts plummeted from 26,284 last year to 1,258 this year. Massachusetts (2,279) and Pennsylvania (2,104) had the highest job losses in the region.
The South, the only region where job cuts increased year over year, rose to 9,099, a 59.4% surge from 5,710 in January 2024. Tennessee saw the largest spike, with 3,453 layoffs compared to just 588 the previous year. Florida (1,732) and North Carolina (1,500) also reported significant reductions.
Why are Companies Cutting?
Closures drove the highest number of layoffs last month with 16,123. Restructuring efforts followed closely, accounting for 12,618 job losses. Market and economic conditions were cited for 8,159 layoffs. Another 6,810 job cuts were announced without a specified reason.
Cost-cutting measures led to 2,425 reductions, while a decline in demand resulted in 1,328 layoffs. Other notable causes included contract losses (1,087), voluntary severance or buyouts (250),
bankruptcy (239), acquisitions or mergers (190), and financial losses (171). External factors also played a role, with natural disasters (152), government regulations (140), and domestic relocations (103) contributing to a smaller share of job reductions.
Hiring Plans
U.S. employers announced plans to hire 6,089 workers in January, a 24% decrease from the 7,999 hiring plans announced in December. It is up 13% from the 5,376 plans announced in January last year, which marked the lowest January total on record. The highest announcements occurred in Technology and Automotive, which also happen to be two of the largest job cutters.
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Contact Colleen Madden Blumenfeld for more data or to set up an interview with SVP Andy Challenger.
