Job Cuts Drop Sharply in April, Yet DOGE Pushes 2025 Layoffs to Pandemic Levels — Evening Brief – 05.01.25
The U.S. job market in 2025 is a tale of two trends: aggressive cost-cutting, especially in government and tech, and tentative steps toward hiring. With DOGE actions reshaping the landscape and economic uncertainty looming, companies are playing it safe—trimming jobs while cautiously adding others. But with weak labor signals piling up, the road ahead looks bumpy.
U.S. employers announced 105,441 job cuts in April, a 62% decrease from March but a 63% increase from April 2024, according to the Challenger, Gray & Christmas report released Thursday. This marks the highest April total since 2020, when the pandemic halted industries, and, excluding 2020, the highest since the 2009 financial crisis.
Year-to-date, 602,493 job cuts have been announced, an 87% surge from the same period in 2024 and the highest first-four-month total since 2020. “Though the government cuts are front and center, we saw job cuts across sectors last month,” said Andrew Challenger, SVP at Challenger, Gray & Christmas. “Generally, companies are citing the economy and new technology. Employers are slow to hire and limiting hiring plans as they wait and see what will happen with trade, supply chain, and consumer spending.”
Government sector cuts soared to 282,227 year-to-date, up over sevenfold from last year, with 281,452 attributed to DOGE cost-cutting measures—a 680% increase from 36,195 in 2024. In April, the sector reported 2,782 cuts, with 2,731 tied to DOGE actions and the rest to economic conditions and cost-cutting. DOGE-related cuts (283,172) and downstream impacts (6,945) account for 48% of 2025’s total cuts, affecting nonprofits and education.
Economic/market conditions drove 95,348 cuts, fueled by uncertainty, consumer spending, and trade challenges, with tariffs cited for 1,413 cuts, including 1,350 in April. Restructuring caused 67,627 cuts, and 60,551 were due to store or location closures.
Technology firms led April cuts with 27,021, up 79% from March, and 64,118 year-to-date, a 35% increase from 2024. Retail saw 7,235 cuts in April and 64,319 year-to-date, up 296% from last year. Healthcare/products companies reported 19,494 cuts year-to-date, up 13%, including 7,654 in April.
Despite the cuts, there’s some good news. Employers announced plans to hire 16,191 workers in April, up 65% from April 2024. Year-to-date, hiring intentions total 70,058, a 50% increase from last year – a sign of cautious optimism amid the storm.
Recent labor market data, however, tempers that hope. The ADP Employment report disappointed, and initial jobless claims spiked to 241,000—well above the expected 223,000. Continuing jobless claims also hit 1.9 million, the highest since November 2021. While seasonal adjustments play a role (non-adjusted claims rose by 26,000), this points to slower hiring in early April—right when the Nonfarm Payroll Survey was conducted. The 80,000 one-week claims spike, though partly seasonal, underscores economic headwinds impacting payrolls.