Layoff pace in December hit lowest level since mid-2024, Challenger says
Lead: Consulting firm Challenger, Gray & Christmas reported Thursday that announced layoffs in December totaled 35,553, the lowest monthly figure since July 2024 and a potential sign of stabilization in the labor market. The December total was down 50% from November and 8% from the same month a year earlier. At the same time, companies disclosed plans to hire 10,496 workers for December. For the full year, employers announced more than 1.2 million cuts, the most since 2020 and a 58% increase from the prior year.
Key Takeaways
- Announced layoffs in December: 35,553, a 50% decline from November and 8% lower than December a year earlier.
- December hires planned: 10,496, up nearly 16% from November and 31% year-over-year.
- Full-year announced cuts: more than 1.2 million, a 58% increase versus the prior year and the highest annual total since 2020.
- Challenger data marks the lowest monthly layoff total since July 2024, after a year dominated by large-scale cuts.
- Weekly initial jobless claims stood at 208,000, and the four-week moving average is the lowest since April 27, 2024 (U.S. Department of Labor).
- Monthly payroll growth has averaged roughly 55,000 this year; the Dow Jones consensus expected December payrolls to rise by about 73,000.
- Despite the December drop, the fourth quarter was the worst since 2008 in terms of announced cuts.
Background
Challenger, Gray & Christmas compiles announced job-cut plans from employers across the United States, and its monthly tallies have tracked a pronounced increase in announced layoffs through the past year. The consulting firm’s series has been widely cited because it captures company-level announcements ahead of actual separations and can foreshadow shifts in labor-market sentiment.
Across 2025, firms in technology, retail and parts of the services sector announced numerous large reductions, driven by slower demand, cost-cutting strategies and post-pandemic business model adjustments. Those announcements pushed the annual tally above 1.2 million—far above pre-2020 norms and the largest yearly total since the pandemic-disruption year of 2020.
Main Event
On Thursday, Challenger released its December results showing 35,553 planned cuts, the fewest in 17 months and down half from November’s pace. That month-to-month fall contrasts with the broader yearly picture of elevated notices and places December as a softer point after several high-caseload months.
The December data also included intended hiring of 10,496 workers, a figure higher than the prior month and up sharply from a year earlier. Challenger’s chief revenue officer Andy Challenger characterized December’s pattern as consistent with the month’s usual seasonal slowdown while noting the combination of lower announced cuts and stronger hiring plans as cautiously encouraging.
Government measures have not mirrored the full extent of Challenger’s announced-cut increases earlier in the year. Weekly initial jobless claims—an administrative indicator of new unemployment filings—have been mostly stable and registered 208,000 in the most recent reporting week, with the four-week average at its lowest point since late April 2024.
Analysis & Implications
Challenger’s data are forward-looking in the sense that they record employer announcements rather than completed separations; as a result, they can lead other labor measures but may also capture broad corporate rhetoric and planned actions that do not fully materialize. The December drop suggests fewer new announced large-scale reductions, but it does not automatically translate into immediate hiring strength at the same magnitude.
The discrepancy between high annual announced cuts and relatively steady unemployment claims points to different rhythms across datasets. Announced cuts can be concentrated in a limited number of large employers and industries, while weekly claims reflect the pace of actual separations and re-employment. That helps explain how a year with heavy announcement volume can coexist with still-modest claims readings.
From a macro perspective, ongoing weak monthly payroll growth—averaging about 55,000 this year—indicates that hiring has been muted even as employers occasionally open roles. If payroll additions remain subdued, consumer demand and wage dynamics could be affected, weighing on economic momentum despite the December softness in announcements.
Comparison & Data
| Period | Announced cuts | Month-on-month change | Planned hires |
|---|---|---|---|
| December (latest) | 35,553 | -50% vs. November | 10,496 |
| November (approx.) | ~71,106 | — | ~9,059 |
| December (year-ago) | ~38,640 | -8% vs. Dec prior year | ~8,023 |
| Full year (2025) | >1,200,000 | +58% vs. prior year | — |
The table above reconstructs the month-to-month and year-over-year relationships described in the Challenger release: December’s announced cuts were roughly half of November’s level and modestly below the prior December. The full-year figure exceeds 1.2 million announced cuts, underscoring how concentrated waves of employer notices through the year pushed annual totals sharply higher.
Reactions & Quotes
The context around the numbers drew responses from the consulting firm and from labor-data sources, each pointing to different readings of the labor market.
“December’s usual slowdown, when paired with rising hiring plans, suggests a tentative improvement after a year marked by heavy job-cut announcements.”
Andy Challenger, Challenger, Gray & Christmas (paraphrase)
Challenger framed the December decline as at least partly seasonal but also noteworthy because hiring intentions ticked up. The firm emphasized that the combination of lower announced cuts and rising hiring plans could be read as a modest positive signal for the overall labor picture.
“Weekly initial claims remain around 208,000, and the four-week average is back to levels not seen since late April 2024, indicating continued underlying stability in filings.”
U.S. Department of Labor (data release, paraphrase)
The Department of Labor’s administrative series continues to show relatively stable filings for unemployment benefits, a factor that has tempered alarm over the year’s announced-cut totals. Analysts note that claims and announced cuts measure different phenomena and can move independently for some time.
Unconfirmed
- Whether all announced December reductions will lead to immediate separations is not certain; some plans may be delayed or scaled back.
- The causal link between elevated announced cuts this year and the relatively stable weekly claims series remains debated and is not definitively established by the available public data.
- Industry-specific timing of cuts and hires—especially in tech and retail—may skew monthly totals; complete firm-level outcomes for December remain being finalized.
Bottom Line
Challenger’s December reading—35,553 announced cuts and 10,496 planned hires—offers a mixed but cautiously positive snapshot: announced layoffs eased sharply at month-end even as the full-year total exceeded 1.2 million. The drop to a 17-month low is encouraging in isolation, but it sits against a calendar year that saw significantly elevated layoff announcements overall.
Policymakers, employers and jobseekers should interpret December’s data in context: the announced-cut series is an early-warning indicator that can move ahead of separations, while claims and payroll measures provide complementary but not identical perspectives. Upcoming payroll reports and industry-level follow-ups will be crucial to determine whether December marks the start of a sustained easing in labor-market stress or a temporary seasonal lull.