Bloomberg, Audio Studios, podcasts, radio news.

I get a lot of push alerts on my phone, and over the last few weeks it seemed like many of them were about layoffs.

Amazon planning to cut thousands of corporate workers.

Target will be eliminating about eighteen hundred rules.

Other tech giants like Meta, Google and Intel have also made cuts this year.

Paramount Skydance expected to eliminate around two thousand jobs in the US, with additional layoffs internationally.

From Amazon to Microsoft, Walmart to ups, US companies have been slashing away at their workforces.

Julia Fanzirez covers the US economy for Bloomberg, and I asked her, is this the kind of layoff spike that we often see at this time of year, or is something else going on?

When you really look at it, it is not looking good.

It is some of the biggest job cuts at over fifteen years.

If you don't don't count the pandemic.

Employers and bankers and economists.

Juliet talks to all of them, and she's hearing again and again that these numbers could be a sign that there's trouble ahead.

I'm David Gerrett, and this is the big take from Bloomberg News Today on the show the Layoff Wave of twenty twenty five, what it reveals about the state of the US economy and what it means for the workers swept up in it.

And so far this year, US companies have announced layoffs of nearly a million people.

That's according to a report from the outplacement firm Challenger, Gray and Christmas.

The last time the country saw layoff numbers that high was during the COVID nineteen pandemic.

Some of the bigger layoff headlines have focused on cuts at tech companies, but the trend goes beyond that.

One industry UPS has cut workers, Lululemon and Target.

I asked Bloomberg's Julia Fanzerias, what's going on.

Each company is saying that there are specific reasons for these layoffs.

You know, in the government sector, a huge reason is because of DOGE, while in other sectors, like the tech sector, artificial intelligence has been driving it.

But it's all of these coming together around the same time that is sending a warning sign to economists that more is possibly to come.

Why are we seeing these layoffs now in the US economy?

The economy is slowing, the labor market is slowing, so that is a fact, and even without the US government data coming out, that has been clear.

Additionally, because there have been these tariffs and economic uncertainty and prices are rising, companies are trying to then cut their costs by cutting their workforce instead of increasing costs on consumers.

So that's another big reason.

The third reason is there have been a lot of mergers.

You know, for Paramount, it was the reason merger with sky Dance, and so each company has a specific reason.

But those are the macroeconomic background contacts that is impacting those layoffs.

Kind of stepping back and looking at the impact of these trade policies, it seems like a lot of these companies have successfully kept those higher prices from being passed on to consumers.

And I wonder if you could kind of dovetail that their efforts to keep prices lower on store shelves with maybe what we're seeing here, is there any kind of causality there they might be having to look for cuts elsewhere as a result of them trying to keep their cost down, their product costs down.

There is absolutely a causality there.

They used to be afraid of losing their employees, so they were labor hoarding because from twenty twenty to twenty twenty two it was very difficult to find workers.

And now with higher prices, they're being asked to make a decision.

Either they increase costs for consumers or they have to cut costs elsewhere.

And where are they going to cut costs?

That's the workforce.

So we've talked about trade policy as a reason for this happening, talked about kind of government priorities, how about AI.

I mean, this is like the overwhelming story and markets and the economy, and I know it's gotten some blame as well that maybe companies, as they reckon with what that means for productivity, as they reckon with how much capex they're going to have to do, maybe this is a reason why we're seeing these layoffs.

As you've looked at the data and talked to experts, what do they say about the role that this massive expenditure in AI is having on the economy.

I think it's interesting because a lot of companies don't want to necessarily point to AI being the reason for layoffs, but economists can see these layoffs happening.

Obviously, there are other macroeconomic factors leading to this, but artificial intelligence has really been one of the biggest ones, and so much so that Federal Reserve hair pal had a question about this and even discuss the fact that these layoffs were large and that they would have to keep looking at the impact of artificial intelligence into the US economy.

For many years, we've had this labor market where there hasn't been a lot of churn, and that's been worrisome to a lot of people.

What does that say just about the overall health of the labor market.

I know that we've seen the federalser have kind of focused more intently now on the labor side of its dual mandate against What does the job market tell us about the health of the US economy more broadly?

You know, when people here that you know there is low firing and then also low hiring, they think that that's a good thing, but in reality it's not because then people who are out of work are finding difficulty getting into work.

Younger employees, young workers are having a difficulty climbing the corporate ladder because they're not able to find other opportunities.

And so the FED and economists are very worried about this.

Economy where there is low turn and that is because that is a sign of a cooling economy.

As you said, the Federal Reserve has been keeping an eye on the labor market mandate, and in recent meetings Jerome Powell actually mentioned the laugh of something they have to keep a close eye on.

And even though economists and the Fed don't have the data to guide them to see if that is really impacting unemployment levels and jobless claims on a numerical if it's actually moving the needle.

They have to keep a close eye on this.

And it is because of the fact that now this low, higher, low fire environment might be switching over to a low, higher, more fire environment.

Julia, As you look at these announcements, are we seeing much from these companies about sort of what it might or might not pretend for the future.

In other words, are they encouraging people to look at these in isolation, or are they telling a kind of broader story about the way it's reshaping their outlook on who they need to have on staff, who they need to hire.

It's a little bit of both.

They are not trying to make it seem like these cuts will continue for a long time.

A lot of these companies.

That's not their goal.

They're trying to say, oh, you know, this is the end of the culling that we needed.

This is, you know, the end of the restructuring.

But I also think they are giving signs of where the jobs will be in the future.

They have specifically said, you know that artificial intelligence has taken over chatbots customer service, They're going to take over those entry level coding jobs.

So there are a lot of both.

Elements of those messagings are in these layoff conversations that companies are having.

Whatever reason these companies are giving for people on the chopping block, layoffs or layoffs.

So what's happening to all those workers who've lost their jobs?

That's next in the midst of the government shutdown.

It's impossible to know exactly how many people have become unemployed so far this year, but private sector estimates place that number at close to a million.

I asked Bloomberg's Julia Fanzera, is what the job market looks like for them?

These employees who have been laid off are having such difficulty re entering the labor market.

It can take months, oftentimes over a year to find another job and these workers are out of a job now, they're looking for sometimes temporary, seasonal jobs and jobs that necessarily they wouldn't have considered, but because they have no other options.

And I think that is also where the feed is very concerned, because again, while low higher low fire might seem like a good thing, it is these workers who are left out of the labor market who are finding difficulty getting back in Julia.

How is that manifesting itself in the survey data that we've seen.

The recent consumer confidence survey was really showing that employees aren't concerned and confidence.

Consumer confidence in general in the economy has you know, waned quite a bit, even though it has necessarily trickled over to consumer spending.

The confidence that consumers have on the economy has dwindled, and these workers increasingly are seeing the economy as harder place to find a job.

It was like a year ago we were talking a lot about this being a really tight labor market.

It was very much a worker's job market.

You kind of ask for more money, be more choosy about the jobs you wanted to take or where you wanted to stay, races you could ask for.

Now it sounds like we're seeing this change underway, and I'm curious just at a macro level what that means both for companies and for workers.

Yeah, workers are very much no longer in the driver's seed.

Actually, some recent data shows that, you know, worker pay increase has slowed much, much, much more than anticipated.

Especially young workers are seeing some of like the slowest gains in their pay increases, which is going to set them back because this is already a generation that was less likely to own a house, They have less investments in the stock market, and so that's going to set them back financially for quite a bit.

But that is the difficulty.

Also is that you know, this is no longer a worker's environment.

They're really feeling this, and the wage growth sometimes is barely barely barely keeping up with inflation.

I want to ask you lastly, when the US government does reopen and we begin to get these data and reports more regularly, again, what's the what's the one that you're most eager to see as you continue to do this reporting on the labor market.

Oh, I'm most eager to see the jobs report.

I think that's and that's really shifted in the past week.

I would say with these layoffs before the inflation report was really the highlight.

Everyone was very concerned, how are they going to collect, you know, October prices because they need those people in person going to brick and mortar stores to collect those prices.

But as these layoffs have become a bigger story, there have been more headlines.

Now that jobs report is going to be very important and seeing how that is going to impact the economy, that's the one I'm most looking forward to.

This is the Big Take from Bloomberg News.

I'm David Gura.

To get more from The Big Take and unlimited access to all of Bloomberg dot com, subscribe today at Bloomberg dot com slash podcast offer.

If you liked this episode, make sure to follow and review The Big Take wherever you listen to podcasts.

It helps people find the show.

Thanks for listening.

We'll be back tomorrow