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Economy in Brief

Challenger Layoffs Fell Again
by Tom Moeller June 1, 2006

The Challenger, Grey & Christmas survey indicated that announced job cuts fell another 10.0% last month and have now fallen in each month of 2006. The decline was to the lowest level since late 2000.

During the last ten years there has been an 83% (inverse) correlation between the three month moving average level of announced job cuts and the three month change payroll employment.

Layoffs fell in transportation (-58.3% y/y) and energy (-97.0% y/y) as did job cuts in electronics (-89.0 y/y), industrial goods (-13.4% y/y), insurance (-61.2% y/y), media (+15.9% y/y) and real estate (-75.0% y/y).

Job cut announcements differ from layoffs. Many are achieved through attrition, early retirement or just never occur.

Challenger also reported a sharp m/m drop in announced hiring plans (-34.1% y/y).

Challenger, Gray & Christmas May April Y/Y 2005 2004 2003
Announced Job Cuts 53,716 59,688 -34.7% 1,072,054 1,039,935 1,236,426
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