from Challenger Gray and Christmas
The third quarter ended with a surge in job cuts, as U.S.-based employers announced plans to shed 58,877 in September, a 43 percent increase from the previous month.
The September total was third largest of the year behind July (105,696) and April (61,582). It was 93 percent higher than the 30,477 planned layoffs announced the same month a year ago.
In all, 205,759 job cuts were announced in the third quarter, making it the largest job-cut quarter since the third quarter of 2009, when planned layoffs totaled 240,233.
The Q3 total was 40 percent higher than the previous quarter’s 181,213 job cuts. It was 75 percent higher than the third quarter of 2014, when 117,374 job cuts were announced.
For the year, employers have announced 493,431 planned layoffs, 36 percent more than the 363,408 cuts tracked from January through September a year ago. The year-to-date total is actually 2.0 percent higher than the 2014 year-end total of 483,171. Said John A. Challenger, chief executive officer of Challenger, Gray & Christmas:
Job cuts have already surpassed last year’s total and are on track to end the year as the highest annual total since 2009, when nearly 1.3 million layoffs were announced at the tail-end of the recession,”
While job cuts over the first two quarters of 2015 were dominated by oil-related industries, recent downsizing activity has been concentrated in the public sector and the computer industry.
The computer industry saw the heaviest job cuts in September, as perpetually struggling Hewlett-Packard announced plans to reduce its workforce by as many as 30,000. In all, the industry saw 32,500 job cuts during the month. That is the highest one-month total for this industry since IBM announced 60,000 job cuts in 1993.
To date, computer firms have announced 58,874 job cuts, just shy of the 59,528 computer-industry jobs cuts in all of 2014.
For the year, the biggest job cutting sector is energy, which has announced 72,708 job cuts since January 1. Most of the energy cuts occurred in the first half of year, with just 12,208 job cuts recorded in the latest quarter. Said Challenger:
While oil cuts have slowed, the issues that helped drive oil prices down in the first place are still impacting the economy. We continued to see the ripple effect of low demand last month when heavy-equipment maker Caterpillar announced plans to reduce its workforce over the next year- and-a-half.
We could see more fallout, which appears to have its origins in China, which after years of building up its national infrastructure appears to now have far too much capacity. As a result, manufacturing plants, retail stores and even entire apartment building are sitting empty.
Fortunately, the American economy continues to improve, which should blunt the impact of the Chinese slowdown. Even with a strong US economy, the situation in China will not go unnoticed.
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