California hammered as national job cuts jump to a five-year high
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- California employers announced 173,022 job cuts through November, up 14% from last year, as tech and entertainment companies restructure and pursue AI investments.
- U.S. layoffs hit 1.17 million this year, the highest since 2020’s pandemic, with tech companies accounting for 154,000 cuts amid AI adoption.
Job cuts across the country are the highest they have been in five years, led by layoffs in California and cutbacks in Washington.
California employers announced 173,022 job cuts from January to November, up nearly 14% from the same period last year, according to the latest monthly report from outplacement firm Challenger, Gray & Christmas.
Nationwide, the total number of cuts climbed 54% to 1.17 million, Challenger, Gray & Christmas said in the report released Thursday.
That is the highest they have been since 2020, when COVID forced mass layoffs. The last time national job cuts were this high without a pandemic was 2009.
The UCLA Anderson Forecast released Wednesday predicts the state and nation will muddle through a weak jobs market until the economy picks up next year.
Much of California’s economy can be divided into high-growth regions such as Los Angeles and parts of the Bay Area, buoyed by a surge in venture-capital investment, while other regions are being hit by tariffs, policy uncertainty and the government’s crackdown on immigrant labor, according to the UCLA Anderson Forecast, released earlier this week.
Nearly 70% of all U.S. venture-capital spending flowed into California in the first half of this year, the forecast found. Los Angeles and Orange counties are drawing heavy funding into aerospace and defense, while the Bay Area continues to absorb major artificial-intelligence investments, widening the divide between capital-rich tech hubs and more vulnerable regions.
California has been suffering through a storm of restructuring from two of its biggest business hubs: Hollywood and Silicon Valley.
The layoffs have been fueled by economic uncertainty on top of a shrinking entertainment industry and radical rethinking of technology brought on by the dawn of an AI age.
Thousands of workers at Intel, Salesforce, Meta, Paramount, Walt Disney Co. and elsewhere have lost their jobs. Even Apple has announced a rare round of reductions.
Workers are on edge as seemingly no corner of the Californian economy has been immune to the cost-cutting.
Thousands of workers have been laid off this year in Hollywood and Silicon Valley as AI shakes up the media and tech industries amid other economic challenges.
The Trump administration’s initiative to cut government spending — through an advisory team it calls the Department of Government Efficiency, also known as DOGE — was the biggest driver of government job cuts. At the same time, economic angst and technological change weighed on the private sector.
The tech industry in California announced 75,262 job cuts, the most out of any industry in the Golden State this year.
The tech industry, once seen as a relatively stable place to grow a career, continues to be hit by job cuts in 2025. Tech companies including Meta, Block, Autodesk and others are among businesses that have slashed their workforce.
As the race to dominate AI heats up, companies are laying off workers while investing in other areas or trying to move faster with fewer middle managers.
Nationwide, tech companies have said they are slashing 153,536 jobs this year through November.
No other industry was close to that total, though the automotive, consumer products, financial and healthcare sectors each announced more than 40,000 job cuts, according to the report.
The top reason companies cited for slashing jobs was restructuring. Store closings, economic and market conditions and artificial intelligence were cited as well.
Tech companies have been releasing more AI-powered products that can generate text, images, code and other content, raising fears among workers across industries that their jobs could be automated.
Since 2023, AI was cited in 71,683 job cuts, according to Challenger, Gray & Christmas.
The AI craze has intensified in the ‘gold rush town’ of San Francisco, spreading through work and social life.
At the same time, some tech companies are announcing hiring plans even amid the cuts. Tech employers have also announced 258,084 planned hires from January to November, up from 14,707.
There were signs that layoffs were slowing, with the totals for just the month of November below a year ago.
That could mean companies are done downsizing. It could also mean some firms are taking a break from job cuts for the holidays, when firing people is bad for a company’s brand.
“Layoff plans fell last month, certainly a positive sign,” Andy Challenger, workplace expert and chief revenue officer for Challenger, Gray & Christmas, said in a news release.
“It was the trend to announce layoff plans toward the end of the year, to align with most companies’ fiscal year-ends,” he said. “It became unpopular after the Great Recession, especially, and best practice dictated layoff plans would occur at times other than the holidays.”
Another fresh economic indicator also showed signs that November wasn’t as bad as much of the year.
Applications for unemployment benefits fell to their lowest level in more than three years last week, the Labor Department reported Thursday. The number of Americans applying for jobless benefits for the week ending Nov. 29 fell to 191,000 from the previous week’s 218,000.
That’s the lowest level since September 24, 2022, when claims came in at 189,000. Analysts surveyed by the data provider FactSet had forecast initial claims of 221,000.
