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posted on 01 June 2017

May 2017 Job Cuts Jump 41 Percent from April

from Challenger Gray and Christmas

The number of workforce reductions announced by US-based employers rose sharply in May, as planned job cuts totaled 51,692 for the month. Nearly 40 percent of those job cuts were announced by Ford Motor Company.

May job cuts were 41 percent higher than the 36,602 job cuts announced in April, and 71 percent higher than the same month last year, when employers shed 30,157 jobs.

Employers have announced a total of 214,495 job cuts so far this year. That is down 28 percent from the 275,218 job cuts that occurred last year through May 2016. Said John A. Challenger, chief executive officer of global outplacement and executive coaching consultancy Challenger, Gray & Christmas, Inc.:

Ford's announcement of 20,000 global layoffs to streamline and cut costs is a typical strategy of large corporations who need to pivot to stay competitive. As consumers demand electric and self-driving options, traditional auto makers will need to adapt.

The automotive industry led all industries last month with 20,271 job cuts, bringing the year-to-date total to 28,996. Retailers continue to announce the most job cuts this year with 55,910, 5,777 of which occurred in May.

"The retail industry is still shedding jobs. We are now seeing the effect of changing consumer behavior in grocery shopping.

"Grocery stores are no longer immune from online shopping. Meal delivery services and Amazon are competing with traditional grocers, and Amazon announced it is opening its first ever brick-and mortar store in Seattle. Amazon Go, which mixes online technology and the in-store experience, is something to keep an eye on since it may potentially change the grocery store shopping experience considerably," said Challenger.

Major Retail Announcements

Stores Closed

Job Cuts

Reason

Macy's

68

10,000

Restructuring

The Limited

250

4,000

Bankruptcy

American Apparel*

110

3,457

Bankruptcy

Wet Seal Inc.

171

3,000

Bankruptcy

Lowe's

2,400

Cost-cutting

Sears/Kmart**

150

406

Cost-cutting

Abercrombie & Fitch***

60

150

Cost-cutting

HHGregg

220

5,000

Bankruptcy

JC Penney

140

5,500

Restructuring

Family Christian Stores

240

1,300

Closing

L.L. Bean

900

Cost-cutting

Payless

400

Bankruptcy

Radioshack

552

Bankruptcy

Bebe

190

960

Restructuring

BCBG Max Azria

120

Bankruptcy

Dollar Express

330

2,800

Acquisition/Merger

Rue 21

400

Bankruptcy

Central Grocers

31

1,900

Bankruptcy

Winn-Dixie

20

Restructuring

Marsh Supermarkets

16

1,535

Bankruptcy

*Based on California Worker Adjustment and Retraining Notification Act listing

**Only cuts found so far in announcements, news reports

***Corporate cuts

Source: Challenger, Gray & Christmas, Inc. ©

Companies in the health care/products industry announced 3,054 job cuts during the month, 55 percent higher than the 1,348 announced in May 2016. To date, 14,323 cuts have been in the in health care/products industry.

Another 12,347 service industry jobs have been shed so far in 2017, with 4,082 announced last month. This is an 83 percent increase from May 2016 when only 673 jobs in service industries were shed.

The telecommunications sector cut 10,815 job cuts so far this year with 546 announced in May, and 10,815 for the entire year. This is 40 percent more than last year when the total was 6,404 layoffs.

CHALLENGER, GRAY & CHRISTMAS, INC.

JOB-CUT ANNOUNCEMENT REPORT

TOP FIVE INDUSTRIES

Year To Date

2017

2016

Retail

55,910

38,264

Automotive

28,996

7,129

Health Care/Products

14,323

9,642

Services

12,345

4,303

Telecommunications

10,815

6,404

MONTH BY MONTH TOTALS

2017

2016

January

45,934

75,114

February

36,957

61,599

March

43,310

44,207

April

36,602

64,141

May

51,692

30,157

June

38,536

July

45,346

August

32,188

September

44,324

October

30,740

November

26,936

December

33,627

TOTAL

214, 495

526,915

Some reductions are identified by employers as workers who will take early retirement offers or other special considerations to leave the company.

LAYOFF LOCATION

Year To Date

Michigan

28,985

California

24,351

Texas

20,014

Ohio

18,983

Indiana

16,666

JOB CUTS BY INDUSTRY

16-May

17-Apr

17-May

YTD 2016

YTD 2017

Aerospace/Defense

2,102

1,408

7,741

8,006

Apparel

159

352

0

Automotive

677

3,424

20,271

7,129

28,996

Chemical

97

106

7,500

400

Commodities

1,084

0

Computer

2,836

840

1,239

36,853

6,973

Construction

720

125

889

790

Consumer Products

297

804

1,387

4,973

2,842

Education

3,359

950

1,646

7,146

7,277

Electronics

518

1,364

1,100

2,484

2,604

Energy

7,572

459

296

75,232

8,635

Entertainment/Leisure

847

318

941

9,319

5,837

Financial

901

608

254

6,750

5,401

Food

1,276

1,689

1,537

7,489

7,648

Government

742

2,314

85

4,369

5,427

Health Care/Products

1,348

3,153

3,054

9,642

14,323

Industrial Goods

3,650

1,159

2,236

18,406

9,343

Insurance

204

4,212

1,772

5,030

Legal

28

40

56

131

Media

475

709

262

2,498

2,210

Non-Profit

203

326

1,347

1,130

Pharmaceutical

1,283

717

243

5,166

3,735

Real Estate

130

197

122

455

Retail

1,287

11,669

5,777

38,264

55,910

Services

673

1,586

4,082

4,303

12,345

Telecommunications

381

487

546

6,404

10,815

Transportation

652

1,561

773

7,907

6,702

Utility

80

21

1,530

TOTAL

30,157

36,602

51,692

275,218

214,495

z%20challenger_jobcuts.png


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