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Economy in Brief

Challenger Job Cut Announcements Increase While Hiring Plans Deteriorate
by Tom Moeller  February 6, 2014

The outplacement firm of Challenger, Gray & Christmas reported that job cut announcements increased to 45,017 (11.6% y/y) during January and reversed the prior month's decline. Layoffs increased m/m the retail, financial, transportation, health care, entertainment/leisure, electronics, commodities, computer and telecommunications industries. These were offset by declines in the chemical, aerospace/defense, industrial goods, media, food and energy industries.

During the last ten years there has been a 62% correlation between the level of job cut announcements and the m/m change in payroll unemployment.

Challenger also samples firms' hiring plans. They fell to a low 6,312 (-89.6% y/y) due to pullbacks in the computer, health care, energy, food industries. These were offset by gains in the education, automotive, retail, pharmaceutical, insurance and industrial goods industries.

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

Comparing U.S. and Euro Area Unemployment Rates from the Federal Reserve Bank of New York can be found here.

Challenger, Gray & Christmas Jan Dec Nov Y/Y% 2013 2012 2011
Announced Job Cuts 45,017 30,623 45,314 11.6 509,051 523,362 606,082
Announced Hiring Plans 6,312 11,362 14,177 -89.6 764,206 630,447 537,572
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