It’s been a dicey year, it seems, for people who work in retail. The industry has cut nearly 76,000 jobs from January through May according to new data from outplacement firm Challenger, Gray and Christmas. That’s second only to DOGE-related government layoffs and is a 274% increase from the retail job cuts announced over the same period last year.

That’s a big number, 274. At first glance, maybe a red flag kind of number.

But Andy Challenger at Challenger, Gray and Christmas said it’s more like a yellow flag. “Of all the different sectors, retail is a very volatile one,” he said.

Challenger’s firm tracks job cuts through public announcements and financial filings. And he said the industry has a lot of brand turnover right now, some of which is normal. 

“We’ve seen quite a few retailers announce that they’re going to be closing stores. JCPenney, Forever 21, Macy’s, Rite Aid, Walgreens,” he said.

But other job cuts have nothing to do with store closings, said Christina Boni, a retail analyst at Moody’s. Walmart recently announced plans to layoff 1,500 workers in technology operations and e-commerce.

“Those would be the primary spaces that, you know, the customer wouldn’t necessarily see. It’s not what’s in the store,” she said.

And those layoffs signal something bigger: Retailers are worried and are looking for places to slim down.

“Clearly we’re in an environment where efficiencies matter,” Boni said.

They matter because consumers are spending less. They have been since the spending boom of 2021, when many retailers over-hired. Aaron Cheris, a retail consultant at Bain & Company, said brands have been trying to hang on to the optimistic view that the boom will come back.

“And now 2025 isn’t better and so they actually have to do something about it,” he said.

Especially with tariffs looming. Cheris said one option is to raise prices — Walmart is also doing that. Of course that’s not such a popular move.

“You’ve seen politicians be very aggressive at pressuring retailers not to do that. And so if they don’t do that, then you’ve got to squeeze the balloon somehow,” he said.

The next option is to cut workers, because labor is typically the biggest cost for any business.