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Economy in Brief

U.S. Challenger Layoffs Again Rise Just Slightly While Hiring Plans Jump
by Tom Moeller   November 03, 2010

The outplacement firm of Challenger, Grey & Christmas indicated that the level of layoffs during October increased slightly to 37,986 but that remained near the smallest number since June of 2000. The level remains down by more than one-half from last year. Planned layoffs announced during the first nine months of 2010 totaled 449,258, down two-thirds from 1,192,587 announced during the first ten months of 2009. Despite the decline in layoffs, the unemployment rate from the Census Department remains high as the number of long-term unemployed has surged.

Layoffs rose in October in the chemical, computer, aerospace & defense, automotive, construction, consumer goods, entertainment/leisure, health care, insurance, retail and services industries. Layoffs fell in pharmaceutical, government, industrial goods, electronics, energy, financial, food, industrial goods and media. 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.

Challenger also samples firms' hiring plans and they jumped last month by 124,766. Plans rose strongly in the energy, financial and services industries but fell sharply in retail.

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

Challenger, Gray & Christmas Oct. Sept. Aug. Y/Y 2009 2008 2007
Announced Job Cuts 37,986 37,151 34,768 -31.8% 1,288,030 1,223,993 768,264
Announced Hiring Plans 124,766 123,076 14,075 116.9% 272,573 118,600 365,583
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