Global| Oct 03 2006Challenger Layoffs Up Sharply
by:Tom Moeller
|in:Economy in Brief
Summary
For September, announced job cuts reported by Challenger, Grey & Christmas jumped for the second month. The 35,037 increase to 100,315 was to the highest level since January. The three month moving average of layoff announcements also [...]
For September, announced job cuts reported by Challenger, Grey & Christmas jumped for the second month. The 35,037 increase to 100,315 was to the highest level since January. The three month moving average of layoff announcements also rose 19.5% to its highest level since April.
During the last ten years there has been an 83% (inverse) correlation between the three month moving average level of announced job cuts and the three month change payroll employment.
A sharply higher level of layoffs in automotive (464.2% y/y), commodities (77.2% y/y), consumer goods (9.5% y/y), industrial goods (-16.1% y/y), and insurance (396.0% y/y) boosted the total. These were offset by declines in retail (-82.7% y/y), financial (-26.5% y/y), real estate and transportation (-90.8% y/y).
Job cut announcements differ from layoffs. Many are achieved through attrition, early retirement or just never occur.
Challenger also reported that announced hiring plans more than tripled m/m (87.9% y/y).
Remarks by Fed Governor Randall S. Kroszner titled What Drives Productivity Growth? Implications for the Economy and Prospects for the Future can be found here.
| Challenger, Gray & Christmas | September | August | Y/Y | 2005 | 2004 | 2003 |
|---|---|---|---|---|---|---|
| Announced Job Cuts | 100,315 | 65,278 | 39.6% | 1,072,054 | 1,039,935 | 1,236,426 |
Tom Moeller
AuthorMore in Author Profile »Prior to joining Haver Analytics in 2000, Mr. Moeller worked as the Economist at Chancellor Capital Management from 1985 to 1999. There, he developed comprehensive economic forecasts and interpreted economic data for equity and fixed income portfolio managers. Also at Chancellor, Mr. Moeller worked as an equity analyst and was responsible for researching and rating companies in the economically sensitive automobile and housing industries for investment in Chancellor’s equity portfolio. Prior to joining Chancellor, Mr. Moeller was an Economist at Citibank from 1979 to 1984. He also analyzed pricing behavior in the metals industry for the Council on Wage and Price Stability in Washington, D.C. In 1999, Mr. Moeller received the award for most accurate forecast from the Forecasters' Club of New York. From 1990 to 1992 he was President of the New York Association for Business Economists. Mr. Moeller earned an M.B.A. in Finance from Fordham University, where he graduated in 1987. He holds a Bachelor of Arts in Economics from George Washington University.
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