:max_bytes(150000):strip_icc()/GettyImages-1480644187-bb5376f9ce574fb9bb1627c5139ce72c.jpg "The Job Market Is Weakening, Says Yet Another Report")
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Key Takeaways
- Job cuts in July were down from the prior month but were 9% higher than the same time last year.
- Employer hiring plans in July were the lowest recorded for that month since 2009 while hiring so far this year is at its slowest pace since 2012.
- Technology companies laid off the most people in July as cost-cutting initiatives continued.
Even more hiring data on Thursday showed the labor market continued to soften in July.
U.S. employers cut 25,885 jobs in July, 47% fewer than the prior month, according to the monthly report from employment firm Challenger, Gray & Christmas. However, when compared with the same time last year, layoffs were 9% higher and the highest for any July since 2020.
The report also showed that U.S. employers slowed their hiring plans. Employers planned to hire 3,676 new employees in July, the lowest monthly total since December and the lowest of any July in data going back to 2009.
“The job market is indeed cooling, with hiring at the lowest point in over a decade. While we are seeing increased cuts in manufacturing sectors, both consumer and industrial, most industries are cutting below last year’s levels,” said Andrew Challenger, senior vice president at Challenger, Gray & Christmas.
The report comes as recent job reports have indicated that the labor market may be weakening, including July’s lower-than-expected private sector hiring report. The Bureau of Labor Statistics will release additional information about the labor market on Friday.
Technology Sector Leads Jobs Cuts
The technology sector led in job cuts, and continues to lead all sectors in job cuts this year. The services sector and food manufacturers also announced significant job reductions in July.
“Technology particularly is going through enormous change, and with earnings misses and years of hyper hiring for many of these companies, it’s not surprising the industry is leading in job-cutting activity,” Challenger said.
The leading reason for layoffs is cost cutting, the survey showed, while market conditions and department closings also significantly contributed to businesses eliminating positions. “Technological updates,” including artificial intelligence, were not cited as a reason for job cuts, and haven’t been since April, the report noted.