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Speaker 1: Bloomberg, Audio Studios, podcasts, radio news.

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Speaker 2: I get a lot of push alerts on my phone,

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Speaker 2: and over the last few weeks it seemed like many

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Speaker 2: of them were about layoffs. Amazon planning to cut thousands

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Speaker 2: of corporate workers. Target will be eliminating about eighteen hundred rules.

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Speaker 2: Other tech giants like Meta, Google and Intel have also

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Speaker 2: made cuts this year. Paramount Skydance expected to eliminate around

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Speaker 2: two thousand jobs in the US, with additional layoffs internationally.

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Speaker 2: From Amazon to Microsoft, Walmart to ups, US companies have

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Speaker 2: been slashing away at their workforces. Julia Fanzirez covers the

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Speaker 2: US economy for Bloomberg, and I asked her, is this

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Speaker 2: the kind of layoff spike that we often see at

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Speaker 2: this time of year, or is something else going on?

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Speaker 1: When you really look at it, it is not looking good.

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Speaker 1: It is some of the biggest job cuts at over

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Speaker 1: fifteen years. If you don't don't count the pandemic.

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Speaker 2: Employers and bankers and economists. Juliet talks to all of them,

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Speaker 2: and she's hearing again and again that these numbers could

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Speaker 2: be a sign that there's trouble ahead. I'm David Gerrett,

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Speaker 2: and this is the big take from Bloomberg News Today

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Speaker 2: on the show the Layoff Wave of twenty twenty five,

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Speaker 2: what it reveals about the state of the US economy

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Speaker 2: and what it means for the workers swept up in it.

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Speaker 2: And so far this year, US companies have announced layoffs

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Speaker 2: of nearly a million people. That's according to a report

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Speaker 2: from the outplacement firm Challenger, Gray and Christmas. The last

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Speaker 2: time the country saw layoff numbers that high was during

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Speaker 2: the COVID nineteen pandemic. Some of the bigger layoff headlines

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Speaker 2: have focused on cuts at tech companies, but the trend

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Speaker 2: goes beyond that. One industry UPS has cut workers, Lululemon

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Speaker 2: and Target. I asked Bloomberg's Julia Fanzerias, what's going on.

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Speaker 1: Each company is saying that there are specific reasons for

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Speaker 1: these layoffs. You know, in the government sector, a huge

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Speaker 1: reason is because of DOGE, while in other sectors, like

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Speaker 1: the tech sector, artificial intelligence has been driving it. But

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Speaker 1: it's all of these coming together around the same time

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Speaker 1: that is sending a warning sign to economists that more

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Speaker 1: is possibly to come.

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Speaker 2: Why are we seeing these layoffs now in the US economy?

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Speaker 1: The economy is slowing, the labor market is slowing, so

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Speaker 1: that is a fact, and even without the US government

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Speaker 1: data coming out, that has been clear. Additionally, because there

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Speaker 1: have been these tariffs and economic uncertainty and prices are rising,

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Speaker 1: companies are trying to then cut their costs by cutting

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Speaker 1: their workforce instead of increasing costs on consumers. So that's

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Speaker 1: another big reason. The third reason is there have been

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Speaker 1: a lot of mergers. You know, for Paramount, it was

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Speaker 1: the reason merger with sky Dance, and so each company

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Speaker 1: has a specific reason. But those are the macroeconomic background

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Speaker 1: contacts that is impacting those layoffs.

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Speaker 2: Kind of stepping back and looking at the impact of

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Speaker 2: these trade policies, it seems like a lot of these

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Speaker 2: companies have successfully kept those higher prices from being passed

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Speaker 2: on to consumers. And I wonder if you could kind

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Speaker 2: of dovetail that their efforts to keep prices lower on

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Speaker 2: store shelves with maybe what we're seeing here, is there

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Speaker 2: any kind of causality there they might be having to

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Speaker 2: look for cuts elsewhere as a result of them trying

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Speaker 2: to keep their cost down, their product costs down.

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Speaker 1: There is absolutely a causality there. They used to be

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Speaker 1: afraid of losing their employees, so they were labor hoarding

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Speaker 1: because from twenty twenty to twenty twenty two it was

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Speaker 1: very difficult to find workers. And now with higher prices,

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Speaker 1: they're being asked to make a decision. Either they increase

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Speaker 1: costs for consumers or they have to cut costs elsewhere.

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Speaker 1: And where are they going to cut costs? That's the workforce.

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Speaker 2: So we've talked about trade policy as a reason for

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Speaker 2: this happening, talked about kind of government priorities, how about AI.

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Speaker 2: I mean, this is like the overwhelming story and markets

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Speaker 2: and the economy, and I know it's gotten some blame

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Speaker 2: as well that maybe companies, as they reckon with what

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Speaker 2: that means for productivity, as they reckon with how much

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Speaker 2: capex they're going to have to do, maybe this is

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Speaker 2: a reason why we're seeing these layoffs. As you've looked

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Speaker 2: at the data and talked to experts, what do they

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Speaker 2: say about the role that this massive expenditure in AI

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Speaker 2: is having on the economy.

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Speaker 1: I think it's interesting because a lot of companies don't

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Speaker 1: want to necessarily point to AI being the reason for layoffs,

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Speaker 1: but economists can see these layoffs happening. Obviously, there are

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Speaker 1: other macroeconomic factors leading to this, but artificial intelligence has

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Speaker 1: really been one of the biggest ones, and so much

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Speaker 1: so that Federal Reserve hair pal had a question about

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Speaker 1: this and even discuss the fact that these layoffs were

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Speaker 1: large and that they would have to keep looking at

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Speaker 1: the impact of artificial intelligence into the US economy.

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Speaker 2: For many years, we've had this labor market where there

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Speaker 2: hasn't been a lot of churn, and that's been worrisome

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Speaker 2: to a lot of people. What does that say just

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Speaker 2: about the overall health of the labor market. I know

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Speaker 2: that we've seen the federalser have kind of focused more

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Speaker 2: intently now on the labor side of its dual mandate

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Speaker 2: against What does the job market tell us about the

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Speaker 2: health of the US economy more broadly?

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Speaker 1: You know, when people here that you know there is

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Speaker 1: low firing and then also low hiring, they think that

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Speaker 1: that's a good thing, but in reality it's not because

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Speaker 1: then people who are out of work are finding difficulty

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Speaker 1: getting into work. Younger employees, young workers are having a

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Speaker 1: difficulty climbing the corporate ladder because they're not able to

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Speaker 1: find other opportunities. And so the FED and economists are

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Speaker 1: very worried about this. Economy where there is low turn

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Speaker 1: and that is because that is a sign of a

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Speaker 1: cooling economy. As you said, the Federal Reserve has been

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Speaker 1: keeping an eye on the labor market mandate, and in

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Speaker 1: recent meetings Jerome Powell actually mentioned the laugh of something

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Speaker 1: they have to keep a close eye on. And even

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Speaker 1: though economists and the Fed don't have the data to

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Speaker 1: guide them to see if that is really impacting unemployment

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Speaker 1: levels and jobless claims on a numerical if it's actually

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Speaker 1: moving the needle. They have to keep a close eye

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Speaker 1: on this. And it is because of the fact that

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Speaker 1: now this low, higher, low fire environment might be switching

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Speaker 1: over to a low, higher, more fire environment.

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Speaker 2: Julia, As you look at these announcements, are we seeing

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Speaker 2: much from these companies about sort of what it might

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Speaker 2: or might not pretend for the future. In other words,

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Speaker 2: are they encouraging people to look at these in isolation,

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Speaker 2: or are they telling a kind of broader story about

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Speaker 2: the way it's reshaping their outlook on who they need

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Speaker 2: to have on staff, who they need to hire.

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Speaker 1: It's a little bit of both. They are not trying

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Speaker 1: to make it seem like these cuts will continue for

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Speaker 1: a long time. A lot of these companies. That's not

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Speaker 1: their goal. They're trying to say, oh, you know, this

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Speaker 1: is the end of the culling that we needed. This is,

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Speaker 1: you know, the end of the restructuring. But I also

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Speaker 1: think they are giving signs of where the jobs will

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Speaker 1: be in the future. They have specifically said, you know

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Speaker 1: that artificial intelligence has taken over chatbots customer service, They're

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Speaker 1: going to take over those entry level coding jobs. So

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Speaker 1: there are a lot of both. Elements of those messagings

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Speaker 1: are in these layoff conversations that companies are having.

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Speaker 2: Whatever reason these companies are giving for people on the

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Speaker 2: chopping block, layoffs or layoffs. So what's happening to all

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Speaker 2: those workers who've lost their jobs? That's next in the

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Speaker 2: midst of the government shutdown. It's impossible to know exactly

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Speaker 2: how many people have become unemployed so far this year,

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Speaker 2: but private sector estimates place that number at close to

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Speaker 2: a million. I asked Bloomberg's Julia Fanzera, is what the

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Speaker 2: job market looks like for them?

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Speaker 1: These employees who have been laid off are having such

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Speaker 1: difficulty re entering the labor market. It can take months,

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Speaker 1: oftentimes over a year to find another job and these

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Speaker 1: workers are out of a job now, they're looking for

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Speaker 1: sometimes temporary, seasonal jobs and jobs that necessarily they wouldn't

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Speaker 1: have considered, but because they have no other options. And

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Speaker 1: I think that is also where the feed is very concerned,

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Speaker 1: because again, while low higher low fire might seem like

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Speaker 1: a good thing, it is these workers who are left

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Speaker 1: out of the labor market who are finding difficulty getting

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Speaker 1: back in Julia.

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Speaker 2: How is that manifesting itself in the survey data that

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Speaker 2: we've seen.

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Speaker 1: The recent consumer confidence survey was really showing that employees

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Speaker 1: aren't concerned and confidence. Consumer confidence in general in the

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Speaker 1: economy has you know, waned quite a bit, even though

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Speaker 1: it has necessarily trickled over to consumer spending. The confidence

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Speaker 1: that consumers have on the economy has dwindled, and these

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Speaker 1: workers increasingly are seeing the economy as harder place to

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Speaker 1: find a job.

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Speaker 2: It was like a year ago we were talking a

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Speaker 2: lot about this being a really tight labor market. It

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Speaker 2: was very much a worker's job market. You kind of

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Speaker 2: ask for more money, be more choosy about the jobs

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Speaker 2: you wanted to take or where you wanted to stay,

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Speaker 2: races you could ask for. Now it sounds like we're

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Speaker 2: seeing this change underway, and I'm curious just at a

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Speaker 2: macro level what that means both for companies and for workers.

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Speaker 1: Yeah, workers are very much no longer in the driver's seed. Actually,

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Speaker 1: some recent data shows that, you know, worker pay increase

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Speaker 1: has slowed much, much, much more than anticipated. Especially young

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Speaker 1: workers are seeing some of like the slowest gains in

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Speaker 1: their pay increases, which is going to set them back

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Speaker 1: because this is already a generation that was less likely

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Speaker 1: to own a house, They have less investments in the

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Speaker 1: stock market, and so that's going to set them back

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Speaker 1: financially for quite a bit. But that is the difficulty.

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Speaker 1: Also is that you know, this is no longer a

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Speaker 1: worker's environment. They're really feeling this, and the wage growth

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Speaker 1: sometimes is barely barely barely keeping up with inflation.

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Speaker 2: I want to ask you lastly, when the US government

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Speaker 2: does reopen and we begin to get these data and

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Speaker 2: reports more regularly, again, what's the what's the one that

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Speaker 2: you're most eager to see as you continue to do

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Speaker 2: this reporting on the labor market.

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Speaker 1: Oh, I'm most eager to see the jobs report. I

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Speaker 1: think that's and that's really shifted in the past week.

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Speaker 1: I would say with these layoffs before the inflation report

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Speaker 1: was really the highlight. Everyone was very concerned, how are

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Speaker 1: they going to collect, you know, October prices because they

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Speaker 1: need those people in person going to brick and mortar

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Speaker 1: stores to collect those prices. But as these layoffs have

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Speaker 1: become a bigger story, there have been more headlines. Now

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Speaker 1: that jobs report is going to be very important and

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Speaker 1: seeing how that is going to impact the economy, that's

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Speaker 1: the one I'm most looking forward to.

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Speaker 2: This is the Big Take from Bloomberg News. I'm David Gura.

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