September layoff plans dip

If anyone decided to take Green Day’s “Wake Me Up When September Ends” very, very literally, they’d be waking up right about now to find…a solid-ish job market.

Employers in the US announced 43,281 job cuts in September, about 18% down from the month before, according to an October 1 report from global outplacement and executive coaching firm Challenger, Gray & Christmas.

That marked the seventh time in 2026 that job cuts were “lower than the corresponding month one year earlier” the report noted.

September’s job cuts also marked a 20% dip from September 2025, and “the lowest total for the month since 2022.”

“Companies are in a wait-and-see period right now. Employers are facing high energy costs, an uncertain war in Iran, a rate hike that could make hiring more expensive, plus the [likelihood] of surging healthcare costs,” Andy Challenger, workplace expert and chief revenue officer for Challenger, Gray & Christmas, said in a statement. “We’ve seen layoff activity subside over this year, and September continues to illustrate this point.”

Hiring weak. While layoff activity subsided last month, companies don’t seem to be adding many jobs. Nonfarm payrolls rose by just 29,000 in September, the Bureau of Labor Statistics reported on October 2, well below the 84,000 forecast of economists surveyed by Dow Jones.

According to the Challenger report, “employers announced plans to hire 90,787 workers in September, up from the 12,325 plans announced in August, as seasonal hiring announcements have begun.” However, the September number was 23% lower than a year ago.

“We’re not seeing the surge of hiring plans that come with the holiday season, which suggests a very cautious approach,” Andy Challenger said.

This year. For 2026 thus far, employers have announced 573,195 job cuts, a significant drop (39%) from 946,426 job cuts in the first nine months of last year. However, the difference is smaller when you remove the government sector, bringing the drop down to 15%, the Challenger report noted.

September job cuts were particularly pronounced in technology. Tech companies disclosed 10,799 cuts in the month, a 77% climb from 6,103 cuts in August.

For the year thus far, technology leads across all industries for the most cuts through September: 165,925, amounting to 29% of all job cuts in 2026. Transportation (44,430) and healthcare/products (37,417) came in second and third.

Zoom out. This isn’t necessarily the AI-job-pocalypse, though. At least, not in the month of September.

“Market and economic conditions” was the most common cause employers gave for job cuts, accounting for 8,789 (or 20%) of layoff plans.

But when you pull back to the year to date, artificial intelligence plays a bigger role. While AI was the fifth-most cited reason in September, it was the top cause of job cut announcements year-to-date, cited in 120,136 announcements.