Layoffs and Startup Growth Redraw U.S. Job Security

U.S. employers announced 1,170,821 planned job cuts in the first 11 months of 2025, up 54% from the same period in 2024, according to Reuters.

At the same time, U.S. Census Bureau Business Formation Statistics show that business applications remained far above pre-2020 levels. That combination suggests a labor market in which job loss and business creation are rising together rather than moving in opposite directions.

Persistent Layoffs Change How Workers View Stability

In its 2026 trends report, Glassdoor said layoffs affecting fewer than 50 workers rose from 38% of layoffs in 2015 to 51% in 2025. The report described this pattern as the “forever layoff,” meaning smaller but repeated cuts rather than occasional mass reductions.

That distinction matters because it changes the experience of job insecurity. Large layoffs are visible and episodic. Smaller recurring reductions can leave more workers expecting that another round may follow.

Glassdoor also said mentions of layoffs and job insecurity in company reviews in late 2025 were higher than in March 2020. That finding supports a broader shift in worker expectations, with employment increasingly seen as contingent even when headline layoff announcements slow.

Reuters, summarizing Challenger, Gray & Christmas data for November 2025, noted that monthly planned job cuts had fallen from October. Even so, the cumulative total for the year remained elevated, which is the more relevant measure for judging the scale of disruption.

Business Formation Stays Elevated

The Census Bureau said business applications reached 5.48 million in 2023 and 5.2 million in 2024. In its March 11, 2026 release, the agency also said applications in 2025 were up 8.13% year to date from the same period in 2024.

The same Census summary said the United States averaged about 430,000 business applications per month in 2024, roughly 50% more than in 2019. Applications identified as likely employer businesses averaged about 140,000 per month, roughly 30% above 2019.

Interest in forming businesses has remained unusually strong for several years, even though many applications will never become operating companies. The post-2020 surge did not quickly return to the earlier baseline.

That persistence is important because it suggests more than a temporary reaction to pandemic conditions. It points to a broader reallocation of work toward self-employment, small firms, and experiments in independent income.

A Broader Base of Founders and Independent Workers

An April 14, 2025 article at Women Entrepreneurs Grow Global, citing Gusto research, said women started 49% of new businesses in 2024, up 69% from 2019. The same article said business starts by Asian, Black, and Hispanic entrepreneurs were also higher than in 2019.

That pattern suggests the increase in business creation is not limited to a narrow group of former technology workers or high-income professionals. The formation surge appears to be spread across a wider demographic base.

A LinkedIn post by Lou Shipley said Entrepreneur magazine data showed 67% more people launched ventures after being laid off in 2024 than the year before. Because that figure is cited through a secondary social post rather than a directly retrieved primary article, it is best treated as an unverified directional indicator rather than a core factual anchor.

More solidly documented is the growth of independent work itself. MBO Partners reported that full-time independent workers rose to 27.7 million in 2024, up from 26 million in 2023, and that 5.6 million independent workers earned at least $100,000 in 2025, nearly double the 2020 level of 3 million.

Higher Formation Does Not Guarantee Durable Businesses

A business application is an early signal of intent. Recurring revenue, margins, and staying power take longer to establish.

That distinction becomes more important when many people enter the same low-barrier categories at the same time. Consulting, professional services, online retail, and creator-led businesses can be launched quickly, but they are also easier for competitors to imitate.

In those markets, differentiation becomes a business requirement rather than a branding preference. A founder needs either unusual access to customers, a specialized capability, or some other advantage that is difficult to copy.

Layoffs and self-employment are becoming parallel features of the same labor market. The open question is how many of these new ventures will become durable employer businesses, how many will remain small sole proprietorships, and how many will disappear after an initial attempt.

That unresolved question may be the central measure of whether the current startup boom represents a lasting reorganization of work or mainly a high-volume response to weaker job security.

For now, the evidence is clear on the first stage of that shift: corporate employment looks less secure, and more Americans are trying to build stability elsewhere.

Sources

• Reuters Staff. "US planned job cuts fall 53% in November, Challenger says." Reuters, 2025.
• Glassdoor. "Glassdoor’s Worklife Trends 2026." Glassdoor, 2025.
• U.S. Census Bureau. "Business Formation Statistics." U.S. Census Bureau, 2026.
• Lucy Brooks. "Women Started 49% of New Businesses in 2024." Women Entrepreneurs Grow Global, 2025.
• MBO Partners. "2025 State of Independence in America Report." MBO Partners, 2025.
• Lou Shipley. "2026: The Year of the Unlikely Entrepreneur." LinkedIn, 2026.