U.S. Companies Slash Jobs Amid Record Profits, Creating a “Jobless Boom”

Profits Up, Jobs Down
Despite record-breaking corporate profits and a surging stock market, 2025 has brought widespread layoffs across the U.S. economy. Nearly one million jobs have been cut so far this year—the highest total since 2020, when the pandemic shuttered businesses nationwide. Economists are calling the trend a “jobless boom,” where profits rise even as hiring stalls.

“It’s something we’ve never seen before,” said Chen Zhao, chief global strategist at Alpine Macro. “It’s odd to see companies like Amazon laying off tens of thousands of workers while reporting huge profits.”

AI’s Growing Influence
The driving force behind this unusual pattern may be the rapid rise of artificial intelligence. AI adoption is helping businesses increase efficiency and cut costs—often by reducing the need for human labor. Once centered in the tech industry, AI-driven productivity is now spreading into sectors like manufacturing, logistics, and finance.

“Labor demand has basically come down to zero,” Zhao explained. “The economy is doing fine, but job growth has flattened.”

A Labor Market in Transition
Economists describe 2025’s employment environment as shifting from “no hire, no fire” stability to one of cautious contraction. Federal Reserve rate cuts in September and October reflect growing concerns about slowing job growth. Yet, unemployment remains relatively low at 4.3%, largely due to an aging workforce and reduced immigration.

Some experts argue AI isn’t solely to blame. Companies may simply be adjusting after pandemic-era overhiring, with layoffs boosting investor confidence. Still, the trend signals a changing balance between profit and people—one where automation is reshaping the definition of economic growth.