Planned layoffs up 42 percent from year ago; unemployment rate drops to 4.9 percent
BUSINESS RECORD STAFF Feb 5, 2016 | 3:59 pm
1 min read time
310 wordsAll Latest News, Economic DevelopmentPlanned layoffs are up, yet the unemployment rate is down. Confused? Here’s a look at the two latest job reports.
Heavy downsizing in the retail and energy sectors pushed monthly job cut announcements to their highest level since last summer, according to the latest report released Thursday by global outplacement consultancy Challenger, Gray & Christmas Inc.
At the same time, U.S. unemployment is back below 5 percent for the first time since 2008, CNN reported. However, hiring is slowing down. The U.S. economy added only 151,000 jobs in January. That is way down from December when the economy gained 262,000 jobs.
For the past several years, hiring has been strong and fewer and fewer people have filed unemployment benefits. But that’s starting to change, CNN reported. The four-week average of people filing for unemployment claims has increased since October, meaning more people are out of work. This trend usually foreshadows slower job growth.
According to the Challenger, Gray & Christmas report, in all, U.S.-based employers reported 75,114 planned job cuts to kick off 2016, a 218 percent increase from a 15-year low of 23,622 in December. January’s figure was 42 percent higher than in the same month a year ago, when employers announced 50,041 job cuts.
Last month represents the highest monthly tally since July 2015, when cuts reached 105,696. It was the largest January total since 241,749 job cuts were announced during the first month of 2009.
Despite relatively strong holiday sales to close out 2015, retailers led all other industries in January job cuts, announcing plans to cut 22,246 jobs from their payrolls. That was the highest retail total since January 2009, when retailers announced 53,968 planned layoffs.
“We’re going through a period of decelerating employment, not that we’re going to go negative,” Phil Orlando, chief economist at Federated Investors, told CNN. January’s jobs report was a “mixed bag.”
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