'cost-cutter' originates from modern English, specifically the compound of 'cost' and 'cutter', where 'cost' meant 'price/expenditure' and 'cutter' is an agent noun from 'cut' meaning 'to make smaller or remove'.

'cost' originates from Old French 'coste' (or 'coust') and ultimately from Latin 'constare' (to stand together / be fixed), applied to price; 'cut' derives from Old English/Germanic roots (with possible Old Norse influence), and the agentive suffix '-er' formed 'cutter'; the compound 'cost-cutter' developed in 20th-century business English to denote a person or measure that reduces costs.

Initially the components meant 'price' ('cost') and 'to cut' ('cut'); over time the compound evolved to mean specifically 'a person or measure that reduces expenditures' rather than a literal cutting action.