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Economy in Brief

Challenger Layoffs Reach Cycle Low
by Tom Moeller May 5, 2010

The outplacement firm Challenger, Grey & Christmas reported that the level of layoffs fell last month to 38,326. It was the lowest level since mid-2006 and remained well under the cycle-high of 241,748 in January of last year. The decline was led by sharply lower layoffs in the government, computer, energy, entertainment, and retail industries. An increased level of layoffs occurred in the construction, financial, health care and utility industries.

Challenger also samples firms' hiring plans. April plans increased for the second month consecutive month to the highest level since 2005. They rose in the transportation, consumer goods, health care and financial industries though most elsewhere they fell.

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 in 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 April March February Y/Y 2009 2008 2007
Announced Job Cuts 38,326 67,611 42,090 -71.1% 1,288,030 1,223,993 768,264
Announced Hiring Plans 15,654 13,994 8,300 -42.2% 272,573 118,600 365,583
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