This is the third month this year where layoffs were under the previous year’s levels.
EMPLOYERS CUT 36,398 JOBS IN MAY; YTD CUTS DOWN 11%
Monthly job cuts declined for the third consecutive month in May, as U.S.-based employers announced plans to trim payrolls by 36,398 during the month, 4.5 percent fewer than 38,121 cuts in April. The May total was 41 percent lower than the same month a year ago, when employers slashed payrolls by 61,887 , according to the report Thursday from global outplacement consultancy Challenger, Gray & Christmas, Inc.
To date, the nation’s employers have announced 219,560 planned job cuts in 2013. That is down 11 percent from the 245,540 planned cuts announced in the first five months of 2012.
It is not unusual to see job cuts decline during the summer months. In fact, May is historically the slowest job-cut month of the year, averaging 57,688 since 1993. The next lowest job-cut month is June, according to Challenger records, which show it averaging 59,887 since 1993. The overall average monthly total across all months since 1993 is 70,288.
The heaviest job-cutting last month occurred in the health care sector, where 4,886 job cuts were tracked. That was up slightly from 4,268 health care job cuts in April and more than double the 2,353 announced in May 2012. Overall, layoffs in health care are up 71 percent in 2013 to 20,867, compared to 12,177 in the first five months of 2012.
Only two other sectors have seen bigger gains: media, where job cuts have increased 249 percent from 1,829 in the first five months of 2012 to 6,388 as of May; and the financial sector, which has seen job cuts increase by 103 percent from 17,284 in 2012 to 35,091 this year.
Largest Job Cut Increases
| Jan-May 2012 | Jan-May 2013 | % Change |
Media | 1,829 | 6,388 | 249.3% |
Financial | 17,284 | 35,091 | 103.0% |
Health Care/Products | 12,177 | 20,867 | 71.4% |
Retail | 20,983 | 32,683 | 55.8% |
Non-Profit | 938 | 1,443 | 53.8% |
The 35,091 job cuts announced by financial firms this year make this the sector with the highest number of layoffs to date. Retail ranks a close second, with 32,683 job cuts this year, including 1,386 in May.
“Despite the increases in some sectors, the overall pace of downsizing has slowed from 2012 levels. That is particularly good news in light of the fact that 2012 saw the fewest annual job cuts since 1997. Job cuts have been on the decline since reaching 55,356 in February and we are heading into the summer, which is the time of year when all business activity, including layoff activity, tends to slow,” said John A. Challenger, chief executive officer of Challenger, Gray & Christmas.
“So far, the threat of massive job cuts related to federal spending cuts has failed to materialize. There were fewer than 1,500 job cuts directly attributed to federal cutbacks and sequestration. Of course, we are not out of the woods when it comes to government downsizing, but an improving economy is helping to bring in more tax revenue and lower the deficit. This may delay and/or minimize the impact of cutbacks on workforce levels,” said Challenger.
Even in areas with increased job cutting, such as health care, simultaneous hiring is offsetting the impact on the economy. In health care, for example, the nearly 21,000 planned job cuts tracked this year are far outweighed by job gains. According to the latest Bureau of Labor Statistics job report, the sector experienced a net gain of 19,000 jobs in April, marking a monthly average of 24,000 jobs per month over the past year. Meanwhile, a recent tally of online help-wanted ads by job search website Granted.com turned up more than 521,000 health care jobs on the site.
In retail, where job cuts are up 56 percent this year to 32,683, more than 550,000 were hired in March and there were still 424,000 openings at the end of the month, according to the Bureau of Labor Statistics job openings and labor turnover survey.
“Home sales and prices are starting to see much better improvements each month. If these gains continue, it is going to drive up consumer confidence and spending through the summer, which should help the economy withstand the typical summer slowdown. We expect layoffs to remain muted through the third quarter. Hopefully, the housing recovery will be strong enough to finally kick hiring into high gear,” said Challenger.
source and full report of layoffs and hirings: Challenger
