January layoffs rose to the highest level for the month since 2009

U.S. employers' announced job cuts surged in the month of January and hit the highest level since 2009, a new report shows.

Global outplacement and executive coaching firm Challenger, Gray & Christmas found that employers announced 108,435 job cuts in January – an increase from the 49,795 cuts announced in the same month last year. Job cuts increased 205% from December, when there were 35,553 layoffs announced.

This January saw the most layoffs for the month since 2009, when 241,749 cuts were announced. It was also the highest monthly total since October 2025, when there were 153,074 layoffs.

"Generally, we see a high number of job cuts in the first quarter, but this is a high total for January. It means most of these plans were set at the end of 2025, signaling employers are less-than-optimistic about the outlook for 2026," said Andy Challenger, workplace expert and chief revenue officer for Challenger, Gray & Christmas.

PRIVATE SECTOR ADDED 22,000 JOBS IN JANUARY, WELL BELOW EXPECTATIONS

The transportation sector had the highest number of job cuts in the month of January with 31,243 announced, most of which came from logistics giant UPS announcing 30,000 cuts as it scales back on handling shipments for Amazon.

Technology firms announced 22,291 cuts in January, most of which came from Amazon, which announced 16,000 reductions as it reorganizes its management structure.

"[Amazon] CEO Andy Jassy, like many CEOs recently, has said AI will cost jobs in the coming years, but this cut appears to be due more to over hiring and reducing layers than to the new technology," Challenger noted.

UPS TO CUT 30,000 MORE JOBS AMID TURNAROUND PLAN

Healthcare companies and health products manufacturers announced 17,107 job cuts in January, which was the most for the sector since April 2020 when 19,453 cuts were recorded.

"Healthcare providers and hospital systems are grappling with inflation and high labor costs. Lower reimbursements from Medicaid and Medicare are also hitting hospital systems. These pressures are leading to job cuts, as well as other cutting measures, such as some pay and benefits," Challenger said.

Chemical manufacturers announced 4,701 cuts in January, which were primarily driven by an announcement at Dow amid an AI and automation shift.

AMAZON TO CUT 16,000 ROLES AS IT LOOKS TO INVEST IN AI, REMOVE 'BUREAUCRACY'

The main reasons companies announced layoffs in January were contract loss, which was cited in relation to 30,784 cuts, while market and economic conditions followed with 28,392 cuts.

Other reasons included restructuring (20,044 cuts), closings (12,738) and artificial intelligence (7,624).

Challenger noted that it's difficult to tell how much an impact AI is having on layoffs, saying that, "We know leaders are talking about AI, many companies want to implement it in operations, and the market appears to be rewarding companies that mention it."

GET FOX BUSINESS ON THE GO BY CLICKING HERE

The report also found that employers announced 5,306 hiring plans in January, the lowest total for the month since Challenger's tracking of the metric began in 2009. 

That figure is down from the 6,089 hiring plans announced in the same month last year, as well as from the 10,496 announced in December.