U.S. employers announced 33,429 job cuts in July, marking the lowest monthly total in two years and down 46% from July 2025, while hiring has increased 25% year-over-year, showing that artificial intelligence is reshaping rather than dismantling the labor market.
- July 2026 saw 33,429 job cuts, down 27% from June and 46% from July 2025, the lowest monthly total in two years
- Technology sector led all industries with 9,867 cuts in July, accounting for 31% of all 2026 layoffs and up 67% year-over-year
- AI cited in 33% of July layoffs (10,970 cuts), marking the fifth consecutive month as the top reason for job cuts since tracking began in 2023
- Hiring increased 25% above last year, with strong demand in aerospace, energy, and manufacturing sectors
- Transportation sector surged 303% with 41,748 cuts through July 2026, absorbing elevated costs and shifting trade conditions
U.S.-based employers announced 33,429 job cuts in July, down 27% from the 45,849 cuts announced in June and down 46% from the 62,075 layoff plans announced in the same month last year, marking the lowest monthly total in two years, according to a report released by Challenger, Gray & Christmas.
July’s total is the lowest monthly total since July 2024, when 25,885 cuts were announced. Through July, employers have announced 477,033 job cuts, down 41% from the 806,383 cuts announced in the first seven months of 2025, marking the fifth time this year cuts are lower than the corresponding month one year earlier.
“Hiring has also increased over last year by 25%, so while AI is shifting the labor market, it is not dismantling it,” says Andy Challenger, workplace expert and chief revenue officer for Challenger, Gray & Christmas.
Key takeaways:
· Technology again led all sectors, announcing 9,867 job cuts in July for a total of 149,023 in 2026, an increase of 67% from the 89,251 cuts announced in this sector through July 2025. Technology now accounts for 31% of all job cuts announced this year.
· Transportation announced the second-most cuts among all industries this year with 41,748, up 303% from the 10,353 during the same period in 2025, as the sector continues to absorb elevated costs and shifting trade conditions.
· In July, artificial intelligence (AI) led all reasons for job cuts, with 10,970 announced during the month, or 33%, marking the fifth consecutive month AI has been the leading reason. Since 2023, when AI was first tracked as a distinct reason, it has been cited in 184,538 job cut announcements.
"Employers are hiring more than they were at this point last year, which bucks the trend we've seen since 2020. The demand is showing up in aerospace, energy, and manufacturing, work that happens on a floor rather than a screen," says Challenger.
