The following information was sent to SMC Business Councils from Challenger, Gray & Christmas, Inc. It highlights the job cuts that were recently announced in January. Hope you find this information useful.
53,486 planned cuts announced in January
Last month, the nation’s employers announced plans to cut 53,486 jobs from their payrolls. That was the largest monthly layoff total since 115,730 job cuts were announced last September, according to job cut report released Thursday by global outplacement firm Challenger, Gray & Christmas, Inc.
The January total was 28% higher than the 41,785 job cuts announced in December. It was 39% higher than January 2011, when employers announced just 38,519 planned cuts.
It is not unusual to see a job-cut surge to start the year. Historically, January is the heaviest job-cut month, averaging 101,084 announced layoffs between 1993 and 2011. October, the next heaviest job-cut month, averaged 82,036 cuts over the same period.
“Last year’s 38,519 January job cuts represent the lowest first-month total on record. Even then, the January 2011 total was higher than the previous month, when 32,004 job cuts were announced. This year marks the sixth consecutive year and the eleventh out of the last thirteen in which January job cuts surpassed the December total,” said John A. Challenger, chief executive officer of Challenger, Gray & Christmas.
Leading the January surge were retailers and financial firms, which announced 12,426 job cuts and 7,611 job cuts, respectively. The retail total was the largest experienced by this sector since January 2010 (16,737). The retail job losses are unrelated to the departure of seasonal workers, which typically are not announced or reported as job cuts. Rather, the cuts are related to restructurings, store closings and other cost-cutting measures.
The 7,611 job cuts in the financial sector mark the largest one-month total since September 2011, when 31,167 job cuts were announced (most of which came from a single announcement by Bank of America).
For the second consecutive month, the government sector saw relatively few job cuts, with these employers announcing just 3,021 layoffs in January. That was up slightly from 2,183 in December. The two low job-cut months is undoubtedly a welcome trend in a sector that averaged 15,255 job cuts per month in 2011 and announced a total of 325,319 job cut in the 24-month period ending in December.
“Of course, it is far too early to say whether we will continue to see low job-cut figures in government. It is highly unlikely, considering that many cities and states continue to struggle with budget deficits. And, then there is the federal level of government, which remains under intense pressure to cut costs. As a result, we expect government layoffs to be heavy again this year,” noted Challenger.
For more information on this topic, please go to www.challengergray.com.