Job-cut plans at 10-year high
March 12, 2001,
NEW YORK -In one more sign of a sputtering U.S. economy, job-cut announcements in February climbed above 100,000-the third straight month of such numbers-as U.S. employers, anxious to cut costs and boost lagging profitability, said they plan to lay off 101,731 workers.
Putting that number into perspective, during 1998, with its 10-year high of 677,795 job cuts, the monthly average of layoffs was 56,483, roughly half of what it's been for the past three months.
At the blazing pace set so far, as many as 750,000 job cuts could be in the works for all of this year, according to Challenger. Job cuts for the three-month period December through February totaled 377,652, up 188.8 percent from 130,752 during the same period a year ago.
On the upside, the February total marked a big 28 percent decline from January's eight-year record monthly total of 142,208 announced layoffs.
"Even if job cuts slow to last year's average of about 51,000 per month, we are potentially looking at year-end job cuts of more than 750,000, which would be an eight-year record," said ceo John Challenger. "The extraordinary three-month job cutting binge is hard evidence that a rapid slowdown is occurring. Just compare the job cuts for the same month a year ago. Even during the heavy 1990s corporate downsizing, we did not see monthly figures like this."
Challenger pointed to a new poll from Wirthlin Worldwide that found 58 percent of U.S. companies taking precautions to prepare for possible layoffs, which include saving more money, investing money and paying off debt.