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Layoffs in the U.S. dropped 29 percent from July to August, staunching the heavy flow of job cuts announced over the summer.
Employers reduced payrolls by 32,188 jobs in August, according to global outplacement consultancy Challenger, Gray & Christmas. That's the lowest monthly total since May (30,157) and the second lowest of the year. There have been 391,288 layoffs announced year-to-date, 10 percent fewer than what was recorded between January and August 2015.
On the other side of the coin, job openings rose by 228,000 in July to a seasonally adjusted 5.9 million, marking the highest level since December 2000, according to the U.S. Department of Labor. The job openings data, increased quit rate, steady hiring and drop in layoffs indicate strong fundamentals in the U.S. labor market.
"The job market is likely to remain healthy over the coming months as those open jobs are filled," said Jennifer Schramm, SHRM-SCP, manager of workforce trends at the Society for Human Resource Management. "For HR professionals it means that they have to keep focusing on building their employer brand and developing strong recruiting and retention strategies so they can compete for the best talent."
Tech Companies Shifting Focus
The computer sector reported 6,103 job cuts in August, the most from any sector. The bulk of those cuts came from Cisco Systems, which announced plans to reduce its workforce by 5,500.
"Since January of last year, there has been a string of large-scale job cuts from major players in the technology sector, including Hewlett-Packard, Intel, Dell, Microsoft and, now, Cisco," said John A. Challenger, chief executive officer of the outplacement firm.
Computer companies have announced 55,567 job cuts to date in 2016, up 111 percent from this time last year. "The surge in cuts does not necessarily signal weakness in the sector, but it certainly signals a shift," Challenger said. "In most cases, we are seeing these firms move from making hardware to providing services."
Employers in the industrial goods (3,073), entertainment and leisure (3,037), and energy (2,430) sectors also experienced significant job cuts in August.
Challenger suggested that low oil prices are a contributing factor in the industrial goods sector, where many of the firms provide materials and equipment to the energy industry.
Most of the entertainment and leisure job cuts from August were due to the closure of the Trump Taj Mahal casino and resort in Atlantic City, which affected 2,845 employees.
Year-to-date, the energy (97,366), computer (55,567), retail (44,643), industrial goods (25,840), and financial (17,707) sectors make up the top five industries for number of layoffs. Texas leads the states in layoffs year-to-date (93,363), followed by California (62,208), Arkansas (18,944), North Carolina (18,393) and Illinois (17,137).
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