US Layoffs Hit 1.2 Million in 2025, Highest Since 2020
Major US corporations have initiated significant workforce reductions in January 2026, accelerating a trend that raises serious questions about the health of the economy. On Wednesday, Amazon announced it would cut approximately 16,000 corporate roles, adding to the 14,000 positions it eliminated in October. Similarly, United Parcel Service (UPS) disclosed plans to remove up to 30,000 operational roles this year. Other firms, including Pinterest and Nike, are also trimming staff, with Nike set to lay off 775 employees at its distribution centers. These cuts follow a challenging 2025, during which US employers eliminated roughly 1.2 million jobs—the highest annual total since the 2020 crisis.
Many of these companies cite strategic restructuring, such as increasing investment in artificial intelligence and automation, as the driver for the layoffs. Amazon's Senior VP of People Experience and Technology, Beth Galetti, framed the move as an effort to "strengthen our organization by reducing layers, increasing ownership, and removing bureaucracy."
Job-Finder Confidence Falls to 43.1% as Recession Indicators Flash
The recent job cuts are more than a seasonal adjustment. Layoffs in 2025 increased 58% from the previous year, reaching a level that, outside of the 2020 pandemic, was last seen during the 2008 financial crisis. This has historically been a reliable recession indicator.
The US lost an average of 22k jobs per month over the last 3 months, the 3rd straight month with a negative 3-month moving average. This is now the 12th time we’ve seen this since 1950. In the 11 previous times the US economy was in a recession.
— Charlie Bilello, Chief Market Strategist at Creative Planning.
Further compounding these concerns, worker confidence is eroding. The perceived probability of finding a new job fell to a low of 43.1% in December 2025, down 4.2% from the prior year. Meanwhile, the average time for an unemployed worker to secure a new position has stretched to 11 weeks, the longest period since 2021. This combination of rising layoffs and weakening job prospects provides a clear signal of economic distress.
Recession Risk Pushes Investors Toward Safe Havens
A weakening labor market typically weighs heavily on risk assets, and cryptocurrencies are no exception. As recession fears mount, investors are adopting a defensive posture, rotating capital out of higher-volatility assets. This flight to safety is already evident in the strong performance of precious metals, which have outperformed digital assets recently. Bitcoin has struggled to build momentum as macroeconomic uncertainty grows.
In the short term, a continued slowdown could dampen consumer spending and disposable income, further reducing speculative investment in the crypto market. However, a prolonged economic downturn could force central banks to pivot toward monetary easing. The prospect of lower interest rates and renewed liquidity injections could create a favorable long-term environment for assets like Bitcoin, positioning them for a potential recovery once risk appetite returns.
