California led the nation in job cuts last year, but the pace slowed in December

Buffeted by upheavals in the tech and entertainment industries, California led the nation in job cuts last year — but the pace of layoffs slowed sharply in December both in the state and nationwide as company hiring plans picked up.

State employers announced just 2,739 layoffs in December, well down from the 14,288 they said they would cut in November.

Still, with the exception of Washington, D.C., California led all states in 2025 with 175,761 job losses, according to a report from outplacement firm Challenger, Gray & Christmas.

The slowdown in December losses was experienced nationwide, where U.S.-based employers announced 35,553 job cuts for the month. That was down 50% from the 71,321 job cuts announced in November and down 8% from the 38,792 job cuts reported the same month last year.

That amounted to good news in a year that saw the nation’s economy suffer through 1.2 million layoffs — the most since the economic destruction caused by the pandemic, which led to 2.3 million job losses in 2020, according to the report.

“The year closed with the fewest announced layoff plans all year. While December is typically slow, this coupled with higher hiring plans, is a positive sign after a year of high job cutting plans,” Andy Challenger, a workplace expert at the firm, said in a statement.

The California economy was lashed all year by tumult in Hollywood, which has been hit by a slowdown in filming as well as media and entertainment industry consolidation.

Meanwhile, the advent of artificial intelligence boosted capital spending in Silicon Valley at the expense of jobs, though Challenger said the losses were also the result of “overhiring over the last decade.”

Workers were laid off by the thousands at Intel, Salesforce, Meta, Paramount, Walt Disney Co. and elsewhere. Apple even announced its own rare round of cuts.

The 75,506 job losses in technology California experienced last year dwarfed every other industry, according to Challenger’s data. It attributed 10,908 of the cuts to AI.

Entertainment, leisure and media combined saw 17,343 announced layoffs.

The losses pushed the state’s unemployment rate up a tenth of a point to 5.6% in September, the highest in the nation aside from Washington, D.C., according to the U.S. Bureau of Labor Statistics data released in December.

September also marked the fourth straight month the state lost jobs, though they only amounted to 4,500 in September, according to the bureau data.

Nationally, Washington, D.C., took the biggest jobs hits last year due to Elon Musk’s initiative to purge the federal workforce. The district’s 303,778 announced job losses dwarfed those of California, though there none reported for December.

The government sector led all industries last year with job losses of 308,167 nationwide, while technology led in private sector job cuts with 154,445. Other sector with losses approaching 100,000 were warehousing and retail.

Despite the attention focused on President Trump’s tariffs regime, they were only cited nationally for 7,908 job cuts last year, with none announced in December.

New York experienced 109,030 announced losses, the second most of any state. Georgia was third at 80,893.

These latest figures follow a report from the Labor Department this week that businesses and government agencies posted 7.1 million open jobs at the end of November, down from 7.4 million in October. Layoffs also dropped indicating the economy is experiencing a “low-hire, low-fire” job market.

At the same time, the U.S. economy grew at an 4.3% annual rate in the third quarter, surprising economists with the fastest expansion in two years, as consumer and government spending, as well as exports, grew. However, the government shutdown, which halted data collection, may have distorted the results.

Still, December’s announced hiring plans also were positive. Last month, employers nationwide said they would hire 10,496 employees, the highest total for the month since 2022 when they announced plans to hire 51,693 workers, Challenger said.

The December plans contrasted sharply with the 12-month figure. Last year, U.S. employers announced they would hire 507,647 workers, down 34% from 2024.

The Associated Press contributed to this report.