U.S.-based employers announced 60,620 job cuts in March, a 25 percent increase from the 48,307 cuts reported in February.
The total, however, was down sharply — by 78 percent — from the 275,240 cuts announced in March of last year, according to a report released Thursday by global outplacement and executive coaching firm Challenger, Gray & Christmas.
Employers announced 217,362 job cuts in the first quarter, marking the lowest Q1 total since 2022, when just 55,696 cuts were recorded. The figure is down 16 percent from the 259,948 cuts announced in the fourth quarter of 2025 and 56 percent lower than the 497,052 cuts reported in the first quarter of 2025.
Andy Challenger, workplace expert and chief revenue officer for Challenger, Gray & Christmas, said that, excluding the wave of federal layoffs announced in February and March of last year, job-cut announcements in 2026 closely followed the pattern of 2025. “Last year, it was Government, Retail, and Technology. This year, it’s Technology, Transportation, and Healthcare,” said Challenger.
More tech layoffs could be on the horizon
Tech companies announced 18,720 job cuts in March, bringing the sector’s total to 52,050 so far in 2026. That marks a 40 percent increase from the 37,097 cuts announced during the same period last year and represents the sector’s highest year-to-date total since 2023, when 102,391 cuts were recorded.
More layoffs could be on the horizon. March’s spike was driven largely by workforce reductions at Dell Inc., according to its latest annual filing. Oracle has also reportedly begun layoffs, though it has not disclosed a total. Meanwhile, Meta is cutting jobs within its Reality Labs division as it shifts resources toward artificial intelligence.
“Companies are shifting budgets toward AI investments at the expense of jobs. The actual replacing of roles can be seen in Technology companies, where AI can replace coding functions. Other industries are testing the limits of this new technology, and while it can’t replace jobs completely, it is costing jobs,” said Challenger.
Economic pressure hits multiple sectors
Transportation has announced the second-highest number of job cuts this year, with 32,241 layoffs, up 703 percent from the 4,017 cuts reported during the same period in 2025 and the highest first-quarter total on record for the sector.
Airlines, shipping firms and other transportation companies are expected to face mounting pressure from the ongoing conflict in Iran, which could further strain the industry.
Healthcare companies and health products manufacturers, including hospitals, have announced 23,520 job cuts so far this year, also the highest first-quarter total on record. The previous peak came in 2023, when 22,950 cuts were recorded.
Education followed with 11,467 job cuts in the first quarter, a 170 percent increase from the 4,242 cuts announced during the same period last year.
Meanwhile, financial institutions have announced 9,397 job cuts year to date, down 41 percent from the 15,982 cuts reported in the first quarter of 2025.
“Financial institutions are being impacted by AI, but these companies are also undertaking traditional cost-cutting initiatives, particularly during a time of uncertainty and volatility in the markets,” said Challenger.
AI’s role in job cuts is growing
Artificial intelligence was the leading driver of job cuts in March, accounting for 15,341 announced layoffs, or roughly 25 percent of the monthly total. Closings followed with 13,931 cuts, while restructuring accounted for 8,726 and market and economic conditions drove 6,597 layoffs.
So far in 2026, market and economic conditions remain the top cause of layoffs, with 45,103 cuts announced year to date. Restructuring follows with 37,916, closely trailed by closings at 37,405 and contract losses at 31,817. AI ranks fifth, with 27,645 announced cuts, representing about 13 percent of all layoff plans this year.
The role of AI in workforce reductions has grown steadily. It was cited in 4,680 job cuts in February, or about 10 percent of that month’s total. For the year to date, AI-related layoffs account for 12,304 cuts, or roughly 8 percent of all planned reductions.
Looking at the longer trend, companies cited AI in 54,836 planned layoffs in 2025, about 5 percent of total cuts. Since tracking began in 2023, AI has been linked to 99,470 job cuts, now representing 3.5 percent of all layoffs over that period, up from 3 percent just a month earlier.
US hiring plans jump in March but trail 2025 pace
Hiring plans surged in March, jumping 157 percent to 32,826 from 12,755 in February. That figure is also up 149 percent from the 13,198 hiring plans announced in March 2025.
Despite the monthly spike, year-to-date hiring plans remain slightly lower. Employers have announced plans to hire 50,887 workers so far in 2026, down 6 percent from the 53,867 planned hires reported during the same period last year.
Seasonal demand played a significant role in March’s increase, with just over 21 percent of announced hiring plans tied to summer jobs.
By industry, Automotive leads all sectors in planned hiring this year with 12,258 roles, followed by Entertainment and Leisure at 8,261.
Why job cuts matter for the housing market
The housing market is closely tied to the labor market, making job cuts a key signal for where conditions may be headed.
Rising layoffs reduce the number of qualified buyers and weaken consumer confidence, often slowing home sales before prices adjust. Prolonged job losses can also lead to more distressed inventory, putting downward pressure on home values in affected areas. A softer labor market can influence mortgage rates and delay new construction, shaping both demand and future supply.
Marty Zankich, owner of the Chamberlin Real Estate School, said he’s keeping a close eye on the job market.
“We are keeping an eye on the interest rates, of course,” Zankich told Inman. “But projected job growth is also a key indicator to follow. When certain fields experience an uptick in job numbers or pay, it can spark a flurry in the market.”
Zankich said middle- to low-income homeowners and potential buyers are the ones most affected by both unemployment and high interest rates, although some first-time buyer programs for low-income individuals can help.
“Most high-net-worth individuals owning homes they want to sell, or those looking to buy in the $1 million and up range, have essentially not been impacted because a large majority of those transactions are all cash and not affected by interest rates,” Zankich said.
