As U.S. corporate profits rise and the stock market hits new highs, investors are reaping the rewards. Yet beneath the surge, companies have cut nearly 1 million jobs this year — the most since 2020, when the pandemic slammed the economy.

The disconnect between soaring company earnings and mounting layoffs amounts to what Chen Zhao, chief global strategist at investment research firm Alpine Macro, calls a "jobless boom." Typically, layoffs accelerate when companies are struggling with declining profitability and need to pare costs.

"We've never seen anything like that"

"This is something that is completely different from a historical playbook," Zhao told CBS News. "It's kind of odd to see Amazon laying off 30,000 people even though the profit is doing really, really well."

At the heart of the issue, Zhao said, is the rapid adoption of artificial intelligence, which is boosting business productivity across multiple industries and the economy at large, while also suppressing demand for workers. Although that trend has initially taken root in the technology sector, it is spreading to other industries as businesses adopt AI as a way to boost productivity and lower costs, he noted.

"You have a labor demand that basically has come down to probably 0% in terms of growth, maybe even a mild contraction, even though the economy is doing fine — profits are doing great," he said. "We've never seen anything like that."

For much of 2025, the job market was described by economists as "no hire, no fire," meaning an environment where workers could count on job security even as hiring around the U.S. cooled. But conditions have changed, and the Federal Reserve cut its benchmark interest rate in both September and October, citing increasing risks to employment growth and with Fed Chair Jerome Powell noting that policymakers are closely watching layoff announcements by big employers.

The Department of Labor's monthly employment report has been on hold since the government shutdown began on Oct. 1, which delayed September's labor market data and is likely to also postpone October's report. Still, economists are turning to other employment measures to assess the health of the labor market, such as data from payroll processor ADP.

By those metrics, job growth looks muted. ADP, which only tracks private-sector hiring, said Wednesday that private employers added 42,000 workers in October, a modest rebound after two months of subpar hiring.

"Employment is stagnating in the fall, according to data available during the shutdown," Bill Adams, chief economist for Comerica Bank, said in an email. "While private employment grew in October, overall employment was likely about flat in the month after accounting for federal layoffs, which aren't measured by ADP."

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