Employment cuts shot in August, offering the last evidence of a slowdown in the labor market as some economists warn about a possible recession, according to data published Thursday by the external firm Challenger, Gray and Christmas (CGC).
American companies announced almost 86,000 job cuts in August, which amounted to a 39% increase over the previous month, CGC said. The figure indicated the largest number of employment cuts in August since 2020, which coincided with the start of the COVID-19 pandemic.
August marks the sixth time this year that the total employment cuts exceeded those of the corresponding month one year before, CGC said.
“After the impact of Dux on the federal government, employers cite economic and market factors such as the engine of layoffs,” said Andrew Challenger, senior vice president and expert in CGC’s labor.
The pharmaceutical and finance industries suffered the largest number of employment cuts last month, according to the data.
Employment cuts figures are produced one day before the publication of a new government job report, which is expected to show 75,000 jobs added in August. If the report meets expectations, it would mark a slight increase of 73,000 jobs added in the previous month.
In general, government job data indicated a strong deceleration in hiring during the summer. The United States added an average of approximately 35,000 jobs for three months that end in July, which marked an important cooling of the approximately 196,000 added jobs on average during the previous period of three months, US Labor Statistics Office The data showed.
Contracting cooling reached a wide strip of industries, including manufacturing and the federal government. The general rate of 4.2% unemployment continued to float near a historically low level, but unemployment increased among black workers, a fact that can sometimes predict the loss of jobs among other groups.
Meanwhile, economic growth slowed in the first half of this year. A government report on the Gross Domestic Product indicated an average annualized growth of 1.2% in the first half of 2025, well below the 2.5% growth last year.
Although they recognized the warm numbers, some analysts previously told ABC News that the warnings about a recession are premature.
Construction workers build a house in a new housing development on July 1, 2025 in Richmond, California.
Justin Sullivan/Getty Images
Until now, the economy has greatly avoided the type of generalized employment losses that often accompany a recession. Consumer spending, which represents approximately two thirds of economic activity, increased more for three months that ended in June, and corporate profits have remained solid.
Hours after the publication of the weak jobs report last month, President Donald Trump dismissed the BLS commissioner, Erika Mcedarfer, a designated by Joe Biden who was confirmed by a bipartisan vote of the Senate in 2024.
In a publication on social networks, Trump flew the strong criticisms of Mcentofer, claiming without evidence that job data had been “manipulated.” The job report presented reviews of the data from the previous months, which is a routine practice.
“We need precise employment numbers. I have ordered my team to shoot this designated politician Biden, immediately. It will be replaced by someone much more competent and qualified,” Trump said Friday.
Mtientefer had served in the federal government for two decades before his shot.
“It has been the honor of my life to serve as a BLS commissioner along with the many dedicated officials in charge of measuring a vast and dynamic economy,” said Mcentofer in a publication on social networks after his dismissal. “It is a vital and important work and I thank your service to this nation.”
William Beach, a former commissioner of the Office of Labor Statistics, who was appointed by Trump, condemned the dismissal of Mtientefer.
“The totally unfounded dismissal of Dr. Erika Mcedarfer, my successor as Commissioner of Labor Statistics in BLS, establishes a dangerous precedent and undermines the statistical mission of the office,” Beach published in X.
Mtientefer did not respond to a request for previous ABC ABC comments.
As a replacement for Mtientefer, Trump nominated EJ Antoni, chief economist of the conservative turning heritage foundation.
