World Bank Cuts 2025 Global Growth Forecast - Major Companies Announcing Layoffs

World Bank Cuts 2025 Global Growth Forecast - Major Companies Announcing Layoffs

Amid Trade Uncertainty

The World Bank has sharply lowered its global economic growth forecast for 2025, projecting expansion of 2.3%, down from an earlier estimate of 2.7%, marking what could be the slowest rate of growth since 2008, excluding periods of global recession.

The downward revision is attributed primarily to heightened trade uncertainty, which has disrupted global policy predictability and weighed heavily on investment and confidence. Intermit Gill, Chief Economist of the World Bank Group, emphasized that persistent international trade discord is undermining the economic gains achieved in the post-World War II era, including efforts to reduce extreme poverty.

The Bank also revised down its 2025 GDP growth projections for major economies:

• United States: Reduced by 0.9 percentage points to 1.4%

• Euro Area: Lowered by 0.3 percentage points to 0.7%

While acknowledging the potential for further deterioration if trade tensions escalate, the report also highlights a possible upside: a halving of current tariffs by mid-2025 could boost global growth by approximately 0.2 percentage points on average over 2025–2026.

The updated outlook follows similar revisions by the OECD, which now anticipates global growth of 2.9% in 2025, down from a previous forecast of 3.1%, citing the same trade-related concerns.

Current trade negotiations—particularly between the U.S., China, and the European Union—remain pivotal. The World Bank underscores that progress toward durable trade agreements could materially improve the growth trajectory.

U.S. Companies Announce Major Layoffs Amid Cost Pressures and AI Disruption

As the federal government's Department of Government Efficiency initiative concludes—with thousands of federal job cuts—corporate America is undergoing a parallel wave of mass layoffs, driven by economic uncertainty, trade tensions, and accelerated adoption of artificial intelligence (AI).

Key Drivers of Layoffs:

• Trade Uncertainty: Tariff policies under President Donald Trump have heightened cost pressures, prompting companies to raise prices and reduce labor.

• Economic Indicators: While the April jobs report was stronger than expected, ADP data showed private-sector hiring at its lowest level in over two years.

• AI Integration: Firms increasingly cite AI as a reason for streamlining operations, reshaping the future of workforce planning.

Major Companies Announcing Layoffs:

1. Procter & Gamble: Cutting 7,000 non-manufacturing jobs (~15%) over two years as part of a restructuring of operations and supply chains.

2. Microsoft: Announced 6,000 job cuts (~3%) across all teams globally to reduce management layers; separate from earlier performance-related layoffs.

3. Citigroup: Eliminating 3,500 roles in China, primarily in IT services, as part of a broader 20,000-job global reduction plan.

4. Walmart: Slashing 1,500 jobs across e-commerce, tech, and advertising (Walmart Connect) as it seeks operational simplification and tariff cost management.

5. Klarna: CEO confirmed a 40% workforce reduction, citing AI automation and a hiring freeze. The company claims AI now performs work previously done by 700 agents.

6. Crowd Strike: Laying off 500 employees (~5%) due to evolving business needs amid rapid changes in the AI-driven cybersecurity landscape.

7. Disney: Cutting hundreds of positions globally in film/TV marketing, publicity, and development, as part of broader efficiency measures.

8. Chegg: Eliminating 248 roles (~22%) in response to AI tools like ChatGPT disrupting traditional education models. Expected savings: up to $110 million by next year.

9. Amazon: Reducing 100 jobs in its devices/services unit (Alexa, Echo, Ring) as part of ongoing cost-trimming; 27,000 roles have been cut since 2022.

10. Warner Bros. Discovery: Planning to lay off fewer than 100 employees, following its corporate restructuring into two core divisions.

Outlook:

While many companies frame these layoffs as strategic or efficiency-driven, the converging forces of AI disruption, trade policy, and economic uncertainty are accelerating structural shifts in labor markets. Executives increasingly expect teams to justify human roles in the context of AI capabilities, indicating that workforce reductions linked to automation may continue.