11:17 AM EST, 11/06/2025 (MT Newswires) -- US job cut announcements surged in October, Challenger Gray & Christmas said Thursday, as the ongoing government shutdown -- now the longest in the country's history -- is likely to delay Friday's nonfarm payrolls report.

US-based employers announced 153,074 job cuts last month, up 183% sequentially and 175% annually, the global outplacement firm said. Employers have so far announced about 1.1 million job cuts this year, up 65% year over year and the highest year-to-date total since 2020, the data showed.

"October's pace of job cutting was much higher than average for the month," said Andy Challenger, the firm's chief revenue officer. "Some industries are correcting after the hiring boom of the pandemic, but this comes as (artificial intelligence) adoption, softening consumer and corporate spending, and rising costs drive belt-tightening and hiring freezes."

Private-sector job cuts were most pronounced in technology amid artificial intelligence integration, slower demand and efficiency pressures, the report showed.

On Wednesday, Automatic Data Processing ( ADP ) said US private jobs rose more than expected last month, marking growth for the first time since July.

The Challenger Gray & Christmas report indicates that ADP's data showing an increase of 42,000 private jobs could be revised down, Derek Holt, Scotiabank's head of capital market economics, said in a report e-mailed to MT Newswires.

"Those laid off now are finding it harder to quickly secure new roles, which could further loosen the labor market," Andy Challenger said. The October figure is the highest total for the month since 2003, and the highest tally for a single month in the fourth quarter since 2008, he said.

With the federal government shutdown continuing, the release of the official October nonfarm payrolls report remains uncertain. Amid the official data blackout, the ADP and Challenger reports offer insights into the labor market amid concerns about the health of the job market.

The Federal Reserve lowered its benchmark lending rate by 25 basis points last week.

During his post-meeting remarks last week, Fed Chair Jerome Powell indicated uncertainty around a potential rate cut in December, while some central bank officials have expressed concerns over persistent inflationary pressures.

The probability of the Fed reducing its policy rate by another 25 basis points in December was at 69% on Thursday, with the remaining odds in favor of a no-change scenario, according to the CME FedWatch tool.

"There's broad evidence of a cooling in hiring and households remain nervous about job security," James Knightley, ING's chief international economist in New York, said in a report, adding that the labor market weakness will likely dampen inflation.

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