U.S. layoffs surged dramatically in March, with job cuts reaching 275,240 - marking a 205% increase compared to the same period last year, according to new data from outplacement firm Challenger, Gray & Christmas. The stark rise positions March 2024 as the third-highest month for layoffs on record, trailing only behind the pandemic peaks of April and May 2020.
The Department of Government Efficiency (DOGE), led by Elon Musk, drove the massive spike in job losses, with over 216,000 federal employees terminated in March alone. The agency's aggressive downsizing campaign has impacted 27 different government departments since February, resulting in more than 280,000 total layoffs of federal workers and contractors.
"March would have been relatively quiet for layoffs if not for DOGE's extensive federal workforce reduction plans," noted Andrew Challenger, senior vice president at Challenger, Gray & Christmas.
The sweeping cuts have created notable disruptions in government services, particularly affecting operations at the Social Security Administration and IRS, where reduced staffing has led to delays in taxpayer services. Some smaller agencies face complete closure. Recent mass terminations at the Internal Revenue Service are threatening to derail ongoing tax audits of wealthy individuals and large corporations, according to current IRS employees. The agency's ability to pursue high-value tax enforcement cases has been severely impacted by staffing cuts.
The ripple effects extend beyond direct government employment, with an additional 4,429 job losses recorded in nonprofits and health organizations due to terminated contracts and reduced federal aid.
Adding to the concerning employment landscape, companies' hiring plans have hit their lowest level since 2012. Organizations have announced intentions to hire approximately 54,000 workers this year - a 16% decrease from the previous year.
As the U.S. Department of Labor prepares to release its monthly jobs report, economists predict continued cooling in the job market, forecasting 130,000 new hires in March, down from February's 151,000. The unemployment rate is expected to rise to 4.2% from 4.1%.