The job market has been sending plenty of mixed signals lately, as weekly jobless claims remain stuck at elevated levels, while ADP reported today the first decline in private sector employment since January.
But the global outplacement consultancy Challenger, Gray & Christmas said this morning that planned job cuts announced by employers fell by 17% to 34,768 in August, the lowest level in over a decade.
“To put this in perspective, job cuts never fell to these levels following the
2001 recession; not even when the economy was reaping the rewards of the housing boom. You have to go all the way back to the expansion of the late 1990s and early 2000 to find a similar pace of downsizing,” said Challenger.
“If there is a double-dip recession on the horizon, either companies do not see it or they have no slack in their existing workforces. The recovery may indeed be stalling, but any slowdown is unlikely to lead to a sudden resurgence in mass layoffs. Unfortunately, a slowing recovery could be met with further delays in much-needed hiring,” said Challenger.
Large companies are flush with cash following steep cuts in expenses and likely see less of a need to cut their workforces. But labor market conditions remain tepid, as evidence by the high level of weekly jobless claims, lukewarm consumer confidence and the lack of a significant number of new jobs being created by the economy.
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