Retailers are shedding jobs at the fastest pace in years, raising alarms about the health of the labor market just as the government announced a massive downward revision to U.S. job growth.
Through August, retailers announced 83,656 job cuts, a 242 percent increase from the 24,489 reported during the same period last year, according to Challenger, Gray & Christmas. August alone saw 85,979 job cuts across all sectors, the highest for the month since 2020. Retail joins pharmaceuticals and financial services as the hardest-hit industries, with analysts warning that the approaching holiday season could bring fewer seasonal hires and potentially more layoffs.
“Retailers are being hard hit by tariffs, inflation, and ongoing economic uncertainty causing bankruptcies and closures,” said Andrew Challenger, Senior Vice President at Challenger, Gray & Christmas. “If tariffs and consumer spending constraints play out, the approaching holiday shopping season may see fewer seasonal hires and, in fact, high layoffs.”
The wave of cuts coincides with troubling news from the Bureau of Labor Statistics. In its annual benchmark revision, released Tuesday, the agency reported that employers added 911,000 fewer jobs in the 12 months through March than previously estimated. That means the economy created only about 850,000 jobs during that time, roughly half the figure first reported. Economists had expected a downgrade of about 700,000, but the larger revision has rattled markets and raised new fears of stagflation.
The adjustment comes amidst political controversy. President Trump recently fired BLS Commissioner Erika McEntarfer after a separate set of downward revisions and has nominated economist E.J. Antoni, a frequent critic of the agency, to replace her. The White House has pointed to the revisions as proof that the agency’s processes are flawed, while experts argue the changes reflect long-standing statistical methods hampered by years of budget constraints.
Markets, which had been poised for a strong opening on Tuesday, turned flat after the announcement. With inflation still running hot and unemployment ticking up to 4.3 percent, Federal Reserve policymakers are under mounting pressure to cut rates at their meeting later this month. Some investors expect a larger half-point reduction, though most forecast a quarter-point move.
While the BLS revision is preliminary and will not be fully incorporated into official reports until next year, the scale of the adjustment, combined with accelerating retail layoffs, underscores the growing sense that the labor market is deteriorating faster than previously believed.
