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Economy in Brief

Challenger Layoffs Moderate Further
by Tom Moeller July 1, 2009

For the fifth consecutive month the outplacement firm of Challenger, Grey & Christmas indicated that job cut announcements eased. In fact, the number of layoff announcements of 74,393 was the least since March of last year. This cycle's largest layoff total occurred this past January when there were 241,749 cuts. Challenger also reported, however, that announced hiring plans remained near the cycle low.

Announcement of job cuts in the pharmaceutical industry fell even further to 515, the lowest level since early 2007. Announcements in the financial industry also fell as did cuts in the services, apparel and (sharply) in the chemical industries. Job cuts in the computer industry fell to the lowest level since December ad layoffs in the auto industry fell as well.

Picking up some steam were job cut announcements in the chemical and in the transportation industry.

During the last ten years there has been a 67% (inverse) correlation between the three month moving average of announced job cuts and the three month change payroll employment. Job cut announcements differ from layoffs. Many are achieved through attrition, early retirement or just never occur.

The Challenger figures are available in Haver's SURVEYS database.

Challenger, Gray & Christmas June May Y/Y 2008 2007 2006
Announced Job Cuts 74,393 111,182 -9.0% 1,223,993 768,264 839,822
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