Layoffs across the U.S. soared in February, reaching their highest monthly total in nearly five years.
According to a report from Challenger, Gray & Christmas, employers announced 172,017 job cuts—an alarming 245% increase from January.
A significant portion of these layoffs stemmed from efforts led by billionaire entrepreneur Elon Musk, with support from President Donald Trump, to trim the federal workforce. The Department of Government Efficiency (DOGE) spearheaded these cuts, leading to 62,242 job losses across 17 federal agencies.
The wave of job reductions comes as Trump pushes forward with plans to shrink the government, implement new tariffs, and tighten immigration policies.
In addition to federal cuts, industries like retail and technology also saw significant layoffs, with companies such as Macy’s and Forever 21 announcing thousands of job losses.
However, despite rising layoffs, February also saw an increase in hiring announcements, with 34,580 new positions planned—marking a 159% year-over-year increase.
Layoff Announcements Reach Highest Level Since 2020 as DOGE Slashes Federal Jobs
Recently dismissed employees from the U.S. Agency for International Development (USAID) were seen carrying boxes with messages as they departed their workplace.
Former USAID staff and supporters gathered outside the agency’s Washington, D.C. offices on February 21, 2025, to applaud them in a symbolic sendoff.
Key Points
- U.S. employers announced 172,017 layoffs in February, a 245% surge from January, marking the highest monthly count since July 2020, according to Challenger, Gray & Christmas.
- More than a third of these layoffs resulted from billionaire entrepreneur Elon Musk’s initiative to reduce the federal workforce. The report states that 62,242 federal jobs were cut.
Government Job Cuts Drive Historic Layoffs:
President Donald Trump’s push to shrink the federal workforce had a major impact on February’s labor market, with layoff numbers hitting their highest levels in nearly five years, according to a report released Thursday by outplacement firm Challenger, Gray & Christmas.
The report revealed that U.S. employers cut 172,017 jobs in February—a dramatic 245% increase from January. This represents the highest monthly job loss since July 2020, a period marked by economic instability during the height of the COVID-19 pandemic.
It also stands as the worst February job loss since 2009, during the global financial crisis.
A significant portion of the cuts stemmed from efforts led by Elon Musk, with Trump’s endorsement, to scale back the federal workforce.
Challenger reported that 62,242 federal positions were eliminated across 17 different agencies.
“With the impact of the Department of Government Efficiency (DOGE) initiatives, along with canceled government contracts, concerns over trade wars, and rising bankruptcies, job cuts surged in February,” said Andrew Challenger, a workplace expert at the firm.
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Layoffs in 2025 Already Outpacing Previous Years:
The trend of workforce reductions began in January, bringing the total job cuts for the first two months of 2025 to 221,812.
This is the highest recorded for this period since 2009 and marks a 33% increase compared to the same time in 2024.
The spike in layoffs comes amid broader economic concerns as Trump moves forward with new tariffs, a smaller federal government, mass deportations, and tougher immigration laws.
These policies have triggered debates about their long-term effects on the economy and job market stability.
Private Sector Job Market Shows Mixed Signals:
While inflation and layoffs remain top concerns for many Americans, economic indicators present a mixed picture of the job market’s trajectory.
Payroll processing company ADP reported on Wednesday that private sector hiring expanded by only 77,000 jobs in February, signaling a slowdown in job creation.
However, government layoffs weren’t the only factor contributing to the spike in job cuts.
- Retail industry cuts: A total of 38,956 retail jobs were slashed in February as companies like Macy’s and Forever 21 announced significant staff reductions. Compared to 2024, retail layoffs in 2025 have increased nearly sixfold.
- Technology sector: Another 14,554 tech jobs were cut in February, though this figure is actually lower than the previous year.
Some Hope Amid the Wave of Layoffs:
Despite the mass layoffs, February did bring some positive hiring news.
Companies announced plans to hire 34,580 new employees, representing a 159% increase in hiring announcements compared to February 2024.
Meanwhile, initial unemployment claims have begun rising in recent weeks, particularly in Washington, D.C., where a large share of government employees are based.
As federal job cuts continue, the broader impact on the U.S. labor market remains a key issue to watch in the coming months.
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