An unofficial but closely watched measure of the U.S. labor market’s health found February had the most layoff announcements since early in the pandemic, amid massive federal workforce cuts led by Elon Musk’s DOGE effort.
Yet hiring is also picking up somewhat, with plans for worker additions up 159% from the same period last year.
U.S.-based employers shed 172,017 jobs in February altogether. That’s the highest monthly total since July 2020, when 262,649 cuts were announced, according to a report Thursday from global outplacement and executive coaching firm Challenger, Gray & Christmas. It’s the biggest count for any February since 2009.
“Private companies announced plans to shed thousands of jobs last month, particularly in retail and technology,” Andrew Challenger, senior vice president at Challenger, Gray & Christmas said in a statement released with the report. “With the impact of the Department of Government Efficiency [DOGE] actions, as well as canceled Government contracts, fear of trade wars, and bankruptcies, job cuts soared in February.”
Challenger’s data tracks publicly announced job cuts. Some economists dislike the report’s methodology because actual layoffs and firings can be lower than announced totals, as firms reduce their workforces through attrition or by closing open job postings.
Still, it is considered a fair barometer of the overall labor market. Another unofficial report, from private payrolls processor ADP released Wednesday, also indicated a sharp slowdown in the job market with far fewer roles added last month than forecast. The official report from the Bureau of Labor Statistics, set to be published Friday morning, could signal further weakening.
In addition to the federal government, retailers have also planned deep job cuts, Challenger found. Those totaled 45,375 so far this year, up dramatically from the 6,751 reductions that the industry announced in the first two months of 2024.
Many retailers have started this year on shakier ground as consumers tighten their spending and President Donald Trump’s new administration unleashes a raft of new trade policies. Target and Best Buy said this week that they’d likely need to raise prices to offset expected tariff costs. End even Walmart, where many wealthier shoppers have flocked in search of bargains, has warned it wouldn’t be “immune” from the steeper import taxes on America’s top trade partners.
But while many industries are bracing for impact, Challenger found no sector outstripped Washington in planned job cuts in February, with 62,242 announced by 17 different government agencies last month. So far this year, the government has cut 62,530 positions, a gargantuan increase from the 151 cuts announced through February 2024.
“It appears the administration wants to cut even more workers, but an order to fire the roughly 200,000 probationary employees was blocked by a federal judge,” Challenger said. “It remains to be seen how many more workers will lose their Federal Government roles.”
Even as cuts accelerated and uncertainty rises for businesses and consumers alike, the U.S. economy retains many of the underlying strengths Trump inherited upon taking office.
Unemployment remains historically low, and many employers are still planning to scoop up more workers. Hiring announcements in February surged to 34,580 jobs, Challenger found, the highest number for the month since 2022. So far this year, companies plan to hire 40,669 workers, compared with the 15,693 hiring plans announced during the same period last year.
Entertainment and leisure firms planned to hire 28,000 new workers, while carmakers announced plans to add 4,831 roles this year.
