Announced U.S. Job Cuts Fall 9.4% From Year Ago, Challenger Says
Employers in the U.S announced fewer job cuts in June than a year earlier as companies retained more skilled workers.
Planned firings fell by 9.4 percent from June 2011 to a 13- month low of 37,551, according to figures released today by Chicago-based Challenger, Gray & Christmas Inc. Manufacturers including makers of industrial goods, consumer products and motor vehicles saw job cuts decline, the report showed.
“Employers appear reluctant to shed too many workers,” John A. Challenger, chief executive officer of Challenger, Gray and Christmas, said in a statement. “While it does not take long to shrink payrolls, it can take a significant amount of time to rebuild them, particularly as reports of a growing skills gap become more widespread,” he said.
Compared with May, job-cut announcements fell 39 percent. The figures are not adjusted for season effects and economists prefer to focus on year-over-year changes rather than monthly numbers.
Education led all industry firings with 6,569 planned cuts in June, almost double the 3,536 jobs cut announced in May. Telecommunications saw a reduction of 3,838 positions.
The report also showed that employers announced plans to take on 12,314 workers in June compared with 7,722 the prior month. Aerospace and defense was the industry that showed the largest increase in hiring plans announced last month, with 2,700 additional workers.
The Labor Department tomorrow may report that payrolls climbed by about 90,000 workers last month after a 69,000 increase in May, according to the median forecast of economists surveyed by Bloomberg News. The unemployment rate probably held at 8.2 percent.
Challenger’s data do not always correlate with figures on payrolls or first-time jobless claims as reported by the government. Many job cuts are carried out through attrition or early retirement. Some employees whose jobs are eliminated find work elsewhere in their companies and many announced staff reductions never take place because business improves. The totals also include foreign affiliates.
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