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U.S.-based employers announced 205,759 layoffs in the third quarter of 2015, the largest number of job cuts since the 240,233 layoffs announced in the third quarter of 2009.
Plans to cut 58,877 jobs in September 2015 ended the third quarter with a 43 percent increase from the previous month, according to global outplacement consultancy Challenger, Gray & Christmas.
The September total was the third largest of the year behind July (105,696) and April (61,582). It was 93 percent higher than the 30,477 planned layoffs announced in September 2014.
The third-quarter total was 40 percent higher than the previous quarter’s 181,213 job cuts and 75 percent higher than the third quarter of 2014, when 117,374 job cuts were announced.
Nearly half a million layoffs (493,431) have been announced so far this year. That’s 36 percent more than the 363,408 job cuts from January through September 2014. The year-to-date total is actually 2.0 percent higher than the 2014 year-end total of 483,171.
“Job cuts have already surpassed last year’s total and are on track to end the year as the highest annual total since 2009, when nearly 1.3 million layoffs were announced at the tail end of the recession,” said John A. Challenger, chief executive officer of Challenger, Gray & Christmas.
“These job cuts are more evidence of churn in the labor market rather than a sign of weakness,” said Tara Sinclair, chief economist for job site Indeed and a professor at George Washington University in Washington, D.C. She pointed out that job openings are at a record high and job postings on Indeed have been very strong, showing growth across all sectors.
“With that context … although layoffs are obviously bad for the individuals, hopefully they will be able to find a new job quickly,” she said.
“Overall the economy is still adding jobs though recently not at the rate we’d like it to be and well under the numbers that economists have been predicting ahead of the monthly jobs reports,” said Jennifer Schramm, SHRM-SCP, manager of workforce trends at the Society for Human Resource Management. “Part of the problem right now is uncertainty, but we’ve also seen some evidence in our research that organizations may be shifting toward more informal employment models. So some may be reducing their regular workforce but then planning to add back in contingent workers if demand for their products and services ramps up.”
While job cuts over the first two quarters of 2015 were dominated by oil-related industries, recent downsizing activity has been concentrated in the public sector and the computer industry, according to Challenger.
Hewlett-Packard announced plans in September to reduce its workforce by as many as 30,000, the highest one-month total for this industry since IBM announced 60,000 job cuts in 1993.
According to the Challenger report, computer companies have announced 58,874 job cuts so far this year, just shy of the 59,528 computer-industry jobs cuts in all of 2014.
The energy sector still owns the heaviest cuts for the year (72,708), even though they were mostly announced in the first six months. “While oil cuts have slowed, the issues that helped drive oil prices down in the first place are still impacting the economy,” Challenger said. “We continued to see the ripple effect of low demand last month when heavy-equipment maker Caterpillar announced plans to reduce its workforce over the next year-and-a-half.”
In addition to the government and computer sectors, energy, industrial goods and retail filled out the top five areas with the most layoffs year-to-date. Texas saw the most job cuts this year through September (88,589), followed by California (63,394), Washington, D.C. (58,225), New York (28,143) and Illinois (27,930).
Roy Maurer is an online editor/manager for SHRM.
Follow him @SHRMRoy
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