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monthly statistics on layoff announcements released on october 3 show that u.s. layoff announcements in september declined from the five-month high in august, but the pace of layoffs so far this year has exceeded last year.

career recruitment firm challenger, gray & christmas said companies announced 72,821 layoffs in september, down 4% from the 75,891 announced in august, which was the highest level since march.

the technology industry topped the list of u.s. corporate layoffs in september, announcing a total of 11,430 layoffs, but so far this year, the number of layoffs in the industry has decreased by 23% compared with 2023. in fact, other major industries such as health care, services and finance also saw fewer layoff announcements this year than last year.

artificial intelligence (ai) is blamed for nearly half of the layoffs in the tech industry. since ai was cited as the reason for layoffs in may 2023, nearly 17,000 layoffs have been attributed to ai.

year to date, corporate headcount announced through september is 609,242, 0.8% higher than in the first nine months of 2023, surpassing the previous year’s cumulative total for the first time this year. the cumulative total is the highest since 2020, the year the coronavirus pandemic began, with nearly 2.1 million job cuts announced in the first nine months of that year.

however, other measures of unemployment, such as the labor department's weekly jobless claims report, have not matched that level of growth so far. for example, new jobless claims fell to their lowest level in four months in the week ended september 21, and overall benefit levels have been little changed in recent months.

"we are now at an inflection point where the labor market may stall or tighten," said andrew challenger, senior vice president at challenger, gray and christmas.

there are signs that the u.s. job market is cooling, so much so that the federal reserve has shifted its efforts to defending jobs after focusing on fighting inflation in early 2022. with inflation approaching its 2% target, fed officials cut the benchmark interest rate by 0.5 percentage point in september and forecast further cuts in the future, hoping the move would ease financial pressure on households and businesses and allow job growth to continue. .

"it will take several months for interest rate cuts to affect employer costs as well as consumers' savings accounts," challenger said. "consumer spending is expected to increase, which may lead to increased demand for workers in consumer-facing industries."

challenger's report comes ahead of friday's monthly nonfarm payrolls report from the u.s. bureau of labor statistics. according to a survey of economists, employers are expected to add 140,000 jobs in september, little changed from the 142,000 jobs added in august. the unemployment rate is expected to remain unchanged at 4.2%.