U.S. July layoffs fall to two-year low as AI tops cause

The pace of announced layoffs in the United States fell sharply in July, reaching its lowest monthly level in two years even as artificial intelligence continued to be the most cited reason for workforce reductions, according to new data from outplacement firm Challenger, Gray Christmas. The report also showed a significant uptick in announced hiring plans, presenting a nuanced picture of a labor market in transition.

U.S. employers announced 33,429 job cuts in July, a 27 percent decrease from the 45,849 announced in June and a 46 percent decline from July 2025. This marks the lowest monthly total since July 2024. For the first seven months of 2026, announced layoffs totaled 477,033, which is 41 percent lower than the 806,383 cuts announced in the same period last year. The firm noted that last year's figures were heavily influenced by a large-scale federal workforce reduction effort.

Despite the overall cooling, the technology sector remains the focal point for cuts. Tech companies announced 9,867 layoffs in July, bringing the sector's 2026 total to 149,023, a 67 percent increase from the same point in 2025. The technology sector alone now accounts for 31 percent of all...