The news: US employers have announced over 1.1 million job cuts this year, the most since 2020 and a 54% increase YoY, according to Challenger, Gray & Christmas.

• Companies reported 71,321 job cuts in November alone, up 24% YoY.
• The three top reasons for layoffs this year are market and economic conditions (including tariffs), restructuring, and AI.

Zoom out: The report, alongside similarly soft numbers from ADP, is unlikely to stem the decline in US consumer confidence. While the end of the government shutdown eased some anxieties, households remain concerned about the weakening labor market and rising inflation.

• Just 1 in 3 Americans say that it is currently a good time to find a quality job, the lowest level since January 2021, according to a November Gallup poll. (A caveat: Most of the survey interviews were done before the government shutdown ended and the delayed release of September’s more upbeat jobs report.)
• Both the University of Michigan’s sentiment tracker and the Conference Board’s Consumer Confidence Index paint a similar picture of widespread pessimism as consumers worry more about their finances and prospects.

These concerns could weigh on holiday spending. As of November, Americans planned to spend $778 on holiday gifts this year, $229 less than they expected the month before, per Gallup. That’s the biggest drop that the pollster has ever recorded, exceeding the $185 decline in spending intentions during the 2008 financial crisis.

Our take: For the most part, consumers’ deteriorating sentiment about the economy hasn’t dampened overall retail spending, which has largely remained resilient. Strong sales for Black Friday weekend bear that out, as shoppers displayed a willingness to open their wallets to take advantage of discounts.

But there were also signs that inflation is reshaping spending patterns. Shoppers stocked up on categories most likely to be affected by tariffs, such as apparel, furniture, and electronics. Unit sales also fell during the period, per Salesforce, indicating that consumers are paying more for fewer goods. That dynamic could influence 2026 spending as wage growth slows and the cost of living rises.

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