Chicago — Jan. 5
Planned job cuts announced by U.S. employers declined in December to 41,785, the lowest monthly total since June, according to the latest report on downsizing activity from global outplacement firm Challenger, Gray & Christmas Inc.
The December total was down 1.6 percent from 42,474 job cuts in November. Last month was up 31 percent from December 2010, when employers announced just 32,004 job cuts, which still stands as the lowest monthly total since 17,241 job cuts were recorded in June 2000.
While 2011 went out like a lamb in terms of downsizing activity, with employers announcing an average of just 42,339 job cuts per month over the final quarter of the year, the yearend job-cut total of 606,082 was 14 percent higher than the 529,973 job cuts announced in 2010. However, the 2010 yearend total was a 13-year low. The 2011 total is still well below the recession peak of 1288,030 annual job cuts reached in 2009.
The increase in job cuts in 2011 was due primarily to heavy job cutting in the government sector, where employers announced plans to eliminate 183,064 jobs, a 29 percent increase from 142,255 in 2010. Government job cuts were 188 percent higher than the second-ranked financial sector, which saw 63,624 job cuts this year.
A large portion of the 2010 job cut increase occurred in September, when job cuts hit a 29-month high of 115,730, more than double the 2011 monthly average of 50,507. Of the September cuts, 80,000, or nearly 70 percent of the total, came from just two organizations: Bank of America and the United States Army.
The government and financial sectors were not the only areas to see increased job cuts. Continued weakness in consumer spending helped contribute to a 32 percent increase in retail job cuts, which totaled 50,946 in 2011, up from 38,751 in 2010. Aerospace and defense contractors felt the fallout from government cutbacks. These employers announced 34,759 job cuts last year, an 82 percent increase from 19,150 the previous year.
Source: Challenger, Gray & Christmas Inc.