Job Cuts Jumped 28% in January: Challenger Report
The number of job cuts announced by employers jumped 28 percent in January, led by retailers and financial firms, according to the latest report by global outplacement firm Challenger, Gray & Christmas.
Employers last month said they planned to cut 53,486 positions, compared with 41,785 job cuts announced in December. The January job cuts were 39 percent higher than during the same period a year earlier, when employers said they planned 38,519 cuts, the lowest first-month cuts on record.
Retailers and financial firms saw the greatest cuts, losing 12,426 and 7,611 jobs, respectively. Challenger said the retail job losses were not related to seasonal hiring, and instead were the result of restructurings, store closings, and other cost-cutting measures.
The financial sector saw the most job losses since September, when 31,167 cuts were announced. Challenger noted that most of those layoffs came from Bank of America.
Government job cuts continued to dwindle for a second straight month, with just 3,021 layoffs announced in January.
“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,” Challenger said in a statement. “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.”
(CORRECTION: A previous version of the story incorrectly stated that January 2012's job cuts were the lowest for the month on record. January 2011 had the lowest number of job cuts on record for the month.)