After the worst year for job cuts since at least 1993, theres finally a light—albeit dim—at the end of the tunnel, according to a study by Challenger, Gray & Christmas Inc., an outplacement company.
Challenger, Gray & Christmas, which tracks the number of announced layoffs by U.S. companies, said the number for 2001 was 1,956,876 job cuts, by far the largest since the company began following job cuts in 1993. However, overall job cut announcements have fallen each month since Sept. 11. In particular, the elimination of computer-related jobs slowed in December, the company said.
In 2001, U.S. companies announced 168,395 computer-related job cuts, according to the study. That made computer jobs the second most frequently cut category for the year, behind only telecommunications with 317,777 job cuts. In December, however, announced computer job cuts slowed to 6,357, making the category No. 13 on the list, behind such industries as financial services, retail, electronics and consumer goods.
Overall there have been announcements of 785,995 job cuts in the United States since Sept. 11—a figure that accounts for 40 percent of the years total job losses The years number of lost jobs is three times higher than the 613,960 job cuts the firm recorded last year.
But December saw 11 percent fewer job cuts than Novembers 181,412 figure. In turn, Novembers number was down 25 percent compared with Octobers 242,192 job cuts. That was down 2 percent from Septembers 248,332 job cuts.
Of course, these numbers are way up over the corresponding months of 2000. The figure for Decembers job cuts, for example, were up 21 percent over 2000s December figure, when 133,713 cuts were announced.
The slowing announced job cuts should presage a similar reduction in the number of workers seeking unemployment benefits, according to John Challenger, CEO of Challenger, Gray & Christmas, in Chicago. A Bureau of Labor Statistics report, issued this week, found that jobless claims rose by 36,000 to 447,000 in the week ending Saturday. The report revised the level of claims for the week ending Dec. 22 to 411,000, from its initial claim of 392,000. The jobless rate hit 5.8 percent in December.
Challenger said the recovery in the job market should be reflected in unemployment figures within the next six months.
"If something positives going on now, at the latest, we might see improvements six months down the line in terms of the unemployment rate easing," he said.
The easing job-cut announcement numbers also imply that weve passed through the darkest days and are on the mend, he said. "The silver lining in this report is weve come off the acute lows in the labor market of September and October, just after the [terrorist] attacks," he said. "These numbers would suggest that theres a good probability those will end up having been the deepest part of the recession."