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Economy in Brief

Challenger Layoffs Approach Recent Low
by Tom Moeller September 3, 2009

The outplacement firm of Challenger, Grey & Christmas indicated that job cut announcements returned last month to near this cycle's low. They fell to 76,456 after having ticked up during July. The figures remain well below this cycle's peak level of layoffs which occurred this past January when there were 241,749 cuts.

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 problem with the reduction in job cuts is that, while hiring plans are up 34.1% from last year, the level remains low.

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

The Exchange Rate: What's in It for Prices? from the Federal Reserve Bank of Philadelphia is available here.

Challenger, Gray & Christmas August July Y/Y 2008 2007 2006
Announced Job Cuts 76,456 97,373 -13.8% 1,223,993 768,264 839,822
Announced Hiring Plans 13,100 17,183 34.1 118,600 365,753 276,525
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