Job Cuts Surge to Highest Level Since 2009 Amid Federal Changes

SILVER SPRING, Maryland — U.S.-based employers announced 172,017 job cuts in February, marking a staggering 245% increase from January and the highest total for the month since 2009, according to a report released Thursday by Challenger, Gray & Christmas.

This surge in layoffs, rooted in actions taken by the newly established Department of Government Efficiency (DOGE), reflects a concerning shift in the labor market amid broader economic challenges, including fears of trade wars and bankruptcies, analysts said.

The February totals include 62,242 job cuts from the federal government across 17 agencies, a dramatic 41,311% increase from the 151 cuts announced in the same month last year. Challenger noted that previous spikes in cut announcements typically coincided with recessions, raising alarm over the current economic trajectory.

“With the impact of the Department of Government Efficiency actions, as well as canceled government contracts, fear of trade wars, and bankruptcies, job cuts soared in February,” said Andrew Challenger, senior vice president at the outplacement firm.

The retail sector followed the government with 38,956 cuts, an increase of nearly sixfold from previous year levels. The technology sector announced 14,554 job cuts, while consumer products companies reported 10,625 reductions.

Despite the disheartening news, businesses unveiled hiring plans for 34,580 new workers in February, the highest number of hiring intentions announced for that month since 2022. Concurrently, the year-to-date total of announced job cuts is 221,812, a 33% increase from the same time frame in 2024.

“It is concerning to see so many job cuts announced,” Challenger added, emphasizing the uncertainty facing workers and businesses alike. “When mass layoffs occur, remaining staff often feel uneasy, which can lead to further voluntary departures.”

An economic report released earlier this week by payroll processing firm ADP showed that private-sector employment grew by just 77,000 jobs in February, a significant drop from January’s 186,000 job gain and below economists’ expectations of 142,500 net additions.

Nela Richardson, chief economist at ADP, reinforced that while tariffs and new policies are grabbing headlines, consumer behavior remains the strongest driver of the economy. “As long as the consumer stays resilient, I think the economy is in good shape,” she said.

The upcoming jobs report release from the Bureau of Labor Statistics is anticipated to reflect job growth, with estimates suggesting an addition of 160,000 jobs and an unchanged unemployment rate of 4%. However, many analysts believe the true impacts of the federal job cuts will not be fully realized until the March and April reports.

Navigating the challenges, Challenger noted that while these cuts raise immediate concerns, the broader labor market remains notably resilient with low unemployment and some sectors showing potential for growth.

“There’s a certain degree of resilience in the labor market despite the recent spikes in job cuts,” Challenger asserted, hinting at potential recovery as economic conditions stabilize.

This story is developing and will be updated as new information arises.