By Harshit
NEW YORK, FEBRUARY 5, 2026 —
Planned job cuts at U.S. companies surged in January to their highest level since the global financial crisis, while hiring intentions fell to their weakest reading in more than 15 years—signaling rising caution among employers heading into 2026.
According to data released Thursday by Challenger, Gray & Christmas, U.S. employers announced 108,435 planned layoffs in January, an increase of 118% from the same month last year and 205% from December 2025. It marked the highest January total since 2009, when the economy was emerging from the Great Recession.
At the same time, companies announced plans to hire just 5,306 workers, the lowest January total on record since Challenger began tracking hiring intentions in 2009.
Employers Enter 2026 With Heightened Caution
The report suggests a potential shift away from the “no-hire, no-fire” labor market narrative that dominated much of 2025.
“Generally, we see a high number of job cuts in the first quarter, but this is a high total for January,” said Andy Challenger, workplace expert and chief revenue officer at Challenger, Gray & Christmas. “It means most of these plans were set at the end of 2025, signaling employers are less-than-optimistic about the outlook for 2026.”
The January spike indicates that many firms entered the new year with cost-cutting strategies already in place, reflecting concerns about slower growth, high borrowing costs, and uncertain demand.
Official Labor Data Tells a Different Story—for Now
Despite the surge in announced layoffs, government labor data has yet to show a corresponding increase in actual job losses.
Initial jobless claims for the week ended January 24 totaled 209,000, remaining near their lowest level in nearly two years, according to the U.S. Department of Labor. That divergence highlights a long-standing gap between announced plans and realized layoffs.
Economists caution that Challenger’s data can be volatile and does not always correlate closely with official employment statistics. However, it often serves as an early indicator of employer sentiment.
High-Profile Layoffs Add to Unease
Several major corporations have announced large workforce reductions in recent weeks, reinforcing concerns that corporate caution may be intensifying.
- UPS accounted for much of the increase in the transportation sector after announcing plans to cut more than 30,000 jobs.
- Amazon disclosed plans to eliminate approximately 16,000 corporate-level roles, pushing the technology sector to the second-highest source of announced layoffs.
- Dow Inc. also revealed significant job reductions as part of restructuring efforts.
Transportation led all sectors in January layoffs, followed by technology, reflecting pressures tied to logistics realignment, automation, and slowing demand.
Hiring Intentions Collapse
Planned hiring in January fell 13% from January 2025 and plunged 49% from December, underscoring how sharply employer confidence has cooled.
The collapse in hiring plans suggests companies are choosing to preserve cash and boost productivity rather than expand headcount, particularly as automation and AI adoption allow firms to operate with leaner workforces.
WARN Filings Point to Broader Cuts Ahead
Additional evidence of workforce reductions is emerging from state-level filings. Notices filed under the Worker Adjustment and Retraining Notification (WARN) Act show that more than 100 companies have given advance notice of significant layoffs in January alone.
While not all WARN notices result in job losses at the scale initially announced, the volume of filings supports the view that workforce reductions may broaden in the coming months.
Outlook: A Test for the “Soft Landing”
The January data adds to concerns that the U.S. labor market may be entering a more fragile phase in early 2026. While layoffs remain low in official statistics, employer plans point to rising downside risk if economic conditions weaken further.
For now, the labor market appears stable—but the Challenger report suggests that stability may be under increasing strain as companies reassess costs, growth prospects, and workforce needs.