U.S. layoffs soar in January, highest in 17 years
U.S. employers laid off 108,435 workers in January 2026, marking the highest number since the 2009 subprime crisis. New hiring drops to 17-year low
In January 2026, the number of layoffs in the United States surged to 108,435, marking the highest level since the 2009 subprime crisis. This increase, which represents a rise of 118% compared to January 2025 and 205% compared to December 2025, highlights a troubling trend in the job market. These figures were revealed by Challenger, Gray & Christmas, a leading recruitment firm, in their latest report.
In addition to the surge in layoffs, new hiring also dropped to its lowest point in 17 years, with just 5,306 new positions announced in January. This is the lowest number of new jobs reported in January since Challenger began tracking this data in 2009, during the final stages of the global economic recession that began in 2008.
The new data shows that employers appear to be more cautious in their hiring plans, which could be a signal of the challenging economic outlook for 2026. Despite initial expectations that the labour market would remain stable, it now seems that layoffs are accelerating faster than anticipated.
Andy Challenger, a labour market expert and the company’s chief revenue officer, pointed out that, typically, large layoffs occur in the first quarter of the year, but the January numbers are notably high. This suggests that many layoffs were planned late in 2025 and reflect employers’ pessimistic outlook for the year ahead.
Despite the uptick in layoffs, the number of new unemployment claims remains relatively low. In the week ending January 31, 2026, initial unemployment claims reached 231,000, the highest level since early December 2025. However, this spike is believed to be due to severe winter storms impacting parts of the country. Long-term trends still show unemployment claims at the lowest levels since October 2024.
The labour market concerns were further heightened by the announcements from major companies such as Amazon, UPS, and Dow Inc., which all revealed substantial workforce reductions. The transportation sector saw the highest number of job cuts, largely due to UPS’s decision to lay off over 30,000 employees, while Amazon followed with a reduction of 16,000 positions, mostly in office-based roles.
Challenger’s report indicates that over 100 companies informed the US Department of Labor of significant layoffs under the Worker Adjustment and Retraining Notification (WARN) Act. This growing number of job cuts is a clear signal that the US job market is facing considerable challenges.
Additionally, the US Bureau of Labor Statistics reported a significant drop in job openings, with only 6.54 million positions available in December 2025, a decrease of 386,000 from the previous month.
Despite the increased layoffs and reduced hiring, the overall unemployment rate remains relatively low. However, this latest data paints a concerning picture for the US labour market in the coming months.
