Job Cuts Fall to Second Lowest Total of the Year

September 8, 2009 – Planned job cuts declined in August to the second lowest level of the year as employers announced layoffs totaling 76,456, according to the latest job-cut report by global outplacement consultancy Challenger, Gray & Christmas, Inc. August was 21 percent lower than July, when 97,373 job cuts were announced. This marks the sixth time in the last seven months that job cuts declined from the previous month. For the third consecutive month, job cuts were lower than a year ago, with August cuts coming in 14 percent below the 88,736 layoffs announced in 2008. While the pace of downsizing has steadily slowed, announced job cuts for the year have managed to reach 1,070,504. That is 60 percent more than at this point a year ago and less than 200,000 away from surpassing the 2008 year-end total of 1,223,993. August job cuts were led by the government and non-profit sector, which announced 38,586 job cuts amid continued struggles resulting from falling tax revenue. That represents the second largest monthly industry total of the year behind the 61,288 job cuts announced by the automotive industry in February. The largest reduction in force in the government or any other sector last month was announced by the United States Post Office, which detailed plans last month to quickly slash 30,000 from 656,000 employee payroll mostly through early retirement buyouts, which for some employees will include a $15,000 incentive. “Until now, government job cuts have been dominated by local and state agencies suffering from depleted budgets. The federal government has been one of the few areas of the economy that is creating jobs. Fortunately, the job cuts by the Post Office are not indicative of a coming surge in federal government downsizing. Rather, the cuts are tied to falling mail volume as more Americans rely on e-mail,” said John A. Challenger, CEO of Challenger, Gray & Christmas. “The next four months will be very telling about the state of the job market. The final four months of the year are typically among the heaviest for downsizing. If monthly job-cut levels remain near 100,000 or lower, it will be a strong indication that the economy and job market are improving.”