If you want to build a booming china shop, you don’t unleash a bull. And if you want to build a booming labor market, you don’t lay off thousands of federal workers.
Employer layoffs surged to 275,240 in March, according to new data from job placement firm Challenger, Gray & Christmas. That’s a 60% increase from last month, when 172,017 cuts were made, and a 205% jump from March 2024, the month with the most layoffs last year.
Last month’s layoffs marked the third-highest monthly total ever recorded by the firm, following April and May 2020, when 671,129 and 397,016 cuts were recorded following the onset of the Covid-19 pandemic. Not only is March an atypical month for high-volume layoffs, but these cuts weren’t widespread.
DOGE prints all over. The majority of these layoffs—216,215, or around 78% of all cullings—came from the federal government, as the (unofficially and unelected) Elon Musk-led DOGE task force orchestrated mass firings at agencies including USAID, Health and Human Services, and the Education Department. While some attempted (or were forced) to walk back layoffs, Challenger’s data found that only 3,972 were actually rescinded last month.
DOGE’s cuts have already set a record for government layoffs, so far impacting 280,253 federal workers and contractors across 27 agencies, and an additional 4,429 workers primarily at nonprofits and health organizations, due to federal aid or contract cuts, Challenger found. The previous record for government layoffs was set in September 2011, when 54,182 federal, state, and local government jobs were eliminated, primarily in the Army.
Some state and local governments have announced plans to hire impacted federal workers. But breaking into the private sector will be trickier, HR Brew previously reported, because the skills required of civil servants differ greatly from those required of employees in other industries. It’s a challenge HR leaders will face as they contemplate how the labor supply will change in the coming months, and how they’ll meet their own labor demands.
Quick-to-read HR news & insights
From recruiting and retention to company culture and the latest in HR tech, HR Brew delivers up-to-date industry news and tips to help HR pros stay nimble in today’s fast-changing business environment.
“Even in the broader market, we’re seeing federal employee cuts, and that’s going to bring in a completely new candidate pool from public sector jobs to private sector jobs. And we’re going to continue to see some, I’ll say, disruption,” Stephanie Sansone, director of talent acquisition at iCIMS, told HR Brew late last month. “The job seekers are going to have bigger hurdles because more candidates are looking for opportunities…That leads to uncertainty, but underscores the value that talent acquisition or recruitment partners can play in matching people that have transferable skills to jobs.”
The other 20%. Technology and retail had the second and third most layoffs in March. Tech companies made 15,055 cuts, a 3% increase from February, but a 14% decrease year over year.
Retailers announced 11,709 layoffs in March. The sector, which has struggled with high-profile bankruptcies and souring consumer sentiment, has made 57,804 cuts so far in 2025—a 370% increase from the same period in 2024. Consumer product manufacturers have also made higher cuts in Q1 2025, at 14,619, up 54% from the year prior.
While only 63 layoffs were attributed specifically to tariffs, all within retail, that number is expected to worsen: “Several sectors will be impacted by tariffs going forward, including consumer, auto, and retail. These sectors are already cutting more workers than last year,” the firm stated.
Pullback on hiring. As layoffs have spiked, hiring enthusiasm has fallen. Companies planned to hire just 53,867 workers so far in 2025, down 16% from Q1 2024. Hiring plans in March fell to 13,198, from 34,580 the month prior. That’s the lowest total hiring in Q1 since 2012, the firm noted.