U.S. Labor Market Near Stall Speed as Layoffs Mount and Fed Weighs Rate Cut

The U.S. labor market continued to show signs of strain in late October 2025, with ADP Research reporting that companies averaged 2,500 weekly job cuts in the four weeks ending November 1. This follows earlier data from ADP, which noted a 11,250 weekly reduction in private payrolls for the four weeks ending October 25. The figures highlight a persistent slowdown in hiring, compounding concerns about economic momentum as the year closes.

The decline in job creation has been driven in part by large-scale layoffs at major corporations. Amazon and Target, for instance, announced significant workforce reductions during the month, with Challenger, Gray & Christmas Inc. reporting the highest planned layoffs for October in over two decades. These cuts reflect broader industry pressures, including shifting consumer demand and cost-cutting measures. Meanwhile, 55% of employed Americans expressed worry about losing their jobs in a Harris Poll conducted in mid-October, underscoring growing anxiety about job security.

The ADP data has become a critical proxy for the labor market amid delays in official government statistics. The U.S. government shutdown earlier in the year disrupted the release of key economic indicators, including the September jobs report, which is expected to show a modest 55,000 payroll increase. Federal Reserve Governor Christopher Waller recently cited the weak job market as justification for a potential rate cut in December. Waller emphasized that inflation has eased closer to the Fed's 2% target and that the labor market is "near stall speed," with rising unemployment claims and stagnant wage growth.

Political concerns about job losses are also shifting toward the impact of artificial intelligence. MAGA supporters have called for transparency on how AI-driven automation might exacerbate unemployment. This comes as U.S. President Donald Trump's administration faces scrutiny over its broader economic policies, including cuts to development aid and infrastructure spending.

The labor market's challenges are not confined to the U.S. The European Commission has launched investigations into Amazon and Microsoft under the Digital Markets Act, scrutinizing their dominance in cloud computing services. While these probes focus on competition issues, they reflect a global regulatory environment increasingly focused on corporate power and its economic ripple effects.

For now, the ADP data underscores a fragile labor market, with companies balancing cost management against the need to maintain employment levels. As the Fed weighs its next moves, the interplay between corporate layoffs, regulatory pressures, and technological disruption will likely shape the economic landscape in the months ahead.