Joann, Rite Aid, JCPenney, and other store closings contributed to a 274% surge in retail layoffs in 2025
Layoff announcements from U.S. employers have increased 80% to 696,309 job cuts through May of this year, compared to the 385,859 cuts announced throughout the first five months of 2024, according to the latest layoffs report from Challenger, Gray & Christmas.
Federal government agencies have been most impacted by planned job cuts in 2025, with 284,827 job reductions year to date, compared to 36,325 U.S. government job cuts announced during the same period last year.
Retail is the second-leading industry in job cuts this year, with 75,802 cuts since the start of 2025. That's a 274% increase in retail job reductions compared to the same period last year, when U.S. companies announced 20,276 layoffs.
Why are companies laying off workers?
According to the report, DOGE-related efforts remain the leading reason given for job cut announcements this year. This includes reductions in federal employee and contractor roles, and private nonprofit layoffs resulting from federal funding cuts.
Market and economic conditions were the second-most cited explanation for announced U.S. layoffs, followed by store closings.
In a news release discussing the layoff report, Andrew Challenger, senior vice president of Challenger, Gray & Christmas said, 'Tariffs, funding cuts, consumer spending, and overall economic pessimism are putting intense pressure on companies' workforces. Companies are spending less, slowing hiring, and sending layoff notices.'
Retail store closures are trending upward
Store closings being among the top reasons cited for U.S. retail layoffs is unsurprising. Fast Company has written extensively about retail store closings throughout the U.S., from companies like Kohl's, Macy's, and JCPenney.
While some retailers have chosen to shutter the doors of some locations, others have filed for bankruptcy protection and announced company-wide store closures.
In January 2025, Joann Fabrics filed for bankruptcy for a second time. The fabric and crafts store previously filed for bankruptcy protection in March 2024. Similarly, Rite Aid publicized its decision to file for Chapter 11 bankruptcy on May 5. The retail pharmacy first filed for bankruptcy in October 2023.
Hiring efforts are up slightly, yet remain sluggish
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