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Economy in Brief

Challenger Layoffs Off Sharply
by Tom Moeller January 4, 2007

For December, announced job cuts reported by Challenger, Grey & Christmas fell a sharp 28.8% to 54,643. The three month moving average of layoff announcements also fell to 66,864, its lowest level since August.

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 sharply m/m in the automotive (+77.0% y/y) and apparel (+1.4% y/y) and services (-57.0% y/y) industries.

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

Challenger also reported that announced hiring plans fell sharply m/m (-84.4% y/y).

Challenger, Gray & Christmas December November Y/Y 2006 2005 2004
Announced Job Cuts 54,643 76,773 -49.3% 839,822 1,072,054 1,039,935
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