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Economy in Brief

U.S. Challenger Job Cut Announcements Jump
by Tom Moeller  August 3, 2011

The outplacement firm of Challenger, Grey & Christmas reported that job cut announcements during July surged. The nearly two-thirds m/m gain to 66,414 brought them to the highest level since March of last year. The uptick in announcements was led by aerospace/defense, chemical, computer, education, financial, government, health care, pharmaceutical and retail industries. During the last ten years there has been a 67% 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 which reversed the June improvement and fell to 10,706, near the recovery low.

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

Challenger, Gray & Christmas Jul Jun May Y/Y % 2010 2009 2008
Announced Job Cuts 66,414 41,432 37,135 59.4 529,973 1,288,030 1,223,993
Announced Hiring Plans 10,706 15,498 10,248 31.3 402,638 272,573 118,600
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