Layoffs are up 39% in August to 85,979

Job cuts surged in August as employers trimmed staff in response to a weakening economic outlook, while private-sector hiring also came in below expectations, signaling further cracks in the labor market. The data is a setback for President Donald Trump, who has repeatedly touted the U.S. economy as the strongest in years.

According to Challenger, Gray & Christmas, U.S. employers announced 85,979 job cuts in August, a 39% increase from July and the highest August total since the 2020 pandemic. Layoffs were concentrated in pharmaceuticals and finance, bringing year-to-date cuts to 892,362—the highest level since 2020. Senior vice president Andrew Challenger said companies increasingly cite economic and market conditions, along with bankruptcies and store closings, as key drivers of layoffs.

A separate ADP report showed private employers added just 54,000 jobs in August, sharply lower than expectations and down from 106,000 in July. While leisure, hospitality, and construction showed relative strength, hiring slowed broadly. ADP’s chief economist Dr. Nela Richardson noted that strong early-year momentum has been undermined by uncertainty, with factors ranging from labor shortages to cautious consumer spending and AI disruptions.

The weaker jobs picture bolsters Trump’s calls for the Federal Reserve to cut interest rates to stimulate growth. Fed Chair Jerome Powell has acknowledged that both demand for and supply of labor are easing, an unusual trend that raises the risk of sharper layoffs and rising unemployment in the months ahead.