Corporate job cuts rose to 132,222 last month, up 42 percent from the 92,917 cuts in December, according to Chicago-based outplacement firm Challenger, Gray & Christmas Inc. However the number of cuts posted in January was far lower than the 248,475 announced in January 2002, when the economy was still reeling from the Sept. 11 terrorist attacks.
In the past six months alone, companies said they were cutting 746,781 workers from their payrolls. That figure is larger than the annual totals of 12 of the past 14 years, Challenger said.
The only good news, Challenger said, was that there was a significant decline in telecommunications job cuts in January. That number fell to 7,265, the second-lowest number in more than two years. In October 2001, the telecommunications sector posted 6,956 job cuts.
The highest number of cuts recorded in January was in the retail industry, which announced 44,087 job cuts. Next was the commodities industry with 10,241 cuts, followed by the transportation sector with 9,958 cuts, government/nonprofits with 8,606 cuts and the telecommunications industry.
“It is probably too much to hope for that President Bush’s economic stimulus plan will be enough to jump-start job creation, considering that we are still seeing monthly job-cut announcements exceeding 100,000,” John A. Challenger, CEO of Challenger, Gray & Christmas, said in a statement.
Challenger said that even if businesses were in a position to hire, they probably would delay any such action in light of the uncertainty surrounding a possible war in Iraq.
In addition, Challenger said there is also the risk that small-business investment in new productivity-enhancing technology and equipment could actually lead to more job losses as those companies replace people with the latest technological advances.