Job Cuts Surge in October to Highest Level in 22 Years Amid AI Boom, Challenger Reports
November 6, 2025 — In October, employers cut jobs fast. Companies reduce their staff as AI grows in use. Outplacement firm Challenger, Gray & Christmas finds changes in the work market.
Sharp Increase in Layoffs
In October, employers cut 153,074 jobs. This jump sits at 183% more than in September and 175% above last October. It is the highest toll for an October since 2003. These cuts add to a record year for job loss since 2009. Andy Challenger, the firm’s Chief Revenue Officer and expert on work trends, said:
"Like in 2003, a new technology has shifted the scene. When job creation stays very low, making cuts in the last quarter leaves a poor view."
Technology Sector Hit Hardest
The tech field lost 33,281 jobs this October. That number is nearly six times higher than September’s count. Many firms mix AI into how they work, so they change roles and reduce headcount.
Other sectors with rising layoffs include:
- Consumer products: 3,409 job cuts
- Nonprofits: 27,651 layoffs so far this year—a 419% jump from the same time in 2024
Year-to-Date Trends and Broader Implications
Year-to-date, there have been 1.1 million job cuts in 2025. This total is up 65% from last year and marks the highest amount since 2020. October alone had the largest monthly cut in the fourth quarter since 2008. Several factors drive this trend:
• AI use leads to many roles going away.
• We see slower spending by buyers and firms, which cuts revenue.
• Rising costs drive companies to reduce spending and stop hiring.
Such trends slow the pace for laid-off workers to find new jobs and make the market more soft.
Contrasting Data and Economic Context
Challenger’s report shows large cuts, yet other data give a mixed view. For example:
• The government recently paused data work because of issues in Washington, D.C.
• Weekly state jobless claims have not spiked.
• Payroll processor ADP shows a net gain of 42,000 private jobs in October.
Federal Reserve officials express concerns about a softer job market. They have already cut their main interest rate twice since last month and might lower it once more in December to help steady the economy.
Summary
October figures bring clear signs of change in the U.S. job market as AI use grows. Some industries shrink after the high hiring seen during the pandemic. New tech and rising costs drive many layoffs. It is important to watch these trends closely, as they will guide future economic policy and recovery in the months ahead.
Reported by Jeff Cox
For CNBC, November 6, 2025
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