Challenger, Gray and Christmas Inc. reported that announced job cuts in the US increased to their highest level since March 2025. The announcement added to concerns over the US labour market, which has weakened this year. On Wednesday, ADP reported that private businesses in the US added a meagre 42,000 jobs, suggesting hiring has stalled. Canada’s labour market has also come under pressure, which has raised concerns about the health of the consumer, according to Fitch Ratings.

• There were 153,074 announced job cuts in the US in October. This marked a 175.3% increase over the same month last year and was the highest number of announced job cuts in October since 2003.
• Several industries experienced a large number of announced job cuts, including warehousing and technology. An executive at Challenger, Gray and Christmas noted that AI adoption, rising costs and slower consumer demand have resulted in companies planning to reduce employee headcount.
• Similarly, Canada’s labour market has come under pressure this year, due in part to US tariffs, which have dragged down economic activity.
• The Bank of Canada (BoC) announced it will cut approximately 10% of its staff, aligned with the government’s plans to reduce expenses. This will impact approximately 225 employees and is expected to be completed by June 2026.
• The slowdown in labour market conditions is one of the factors contributing to Fitch Ratings’ expectation that Canadian consumer demand will moderate in 2026 and weigh on overall growth.

Soft labour market conditions in Canada and the US are raising concerns about consumer strength. Pressure on consumers could result in a pullback in spending, which has been a key driver of economic growth in both countries. The BoC and the US Federal Reserve Board will make one more interest rate decision in 2025. Both have cut interest rates at recent meetings, mainly in response to slowing labour market conditions.

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