2019 November Challenger Report: In Penultimate Month, Job Cuts Fall 11%, YTD Up 13%
Job cuts announced by U.S.-based employers fell to 44,569 in November, 11.3% lower than the 50,275 cuts announced in October, according to a report released Thursday from global outplacement and business and executive coaching firm Challenger, Gray & Christmas, Inc.
Last month’s total is 16% lower than the 53,073 cuts announced in the same month last year.
Employers have announced plans to cut 559,713 jobs from their payrolls, 13.1% higher than the 494,775 cuts announced through November last year. It is the highest January-November total since 2015, when 574,888 cuts were announced. Job cuts announced in 2019 have already surpassed the full-year total in 2018, when 538,659 cuts were announced.
“Employers did not make large-scale job cut plans in November. While concerns of a downturn may linger, consumer confidence is strong and companies are holding on to their employees in a tight labor market,” said Andrew Challenger, Vice President of Challenger, Gray & Christmas, Inc.
November cuts were led by the Technology sector, which announced 7,292 cuts last month. So far this year, Technology companies have announced plans to cut 63,447 jobs from their payrolls, the third-highest total for any industry through November. The Technology sector’s total is 380% higher than the 13,222 cuts announced in this industry in the same period last year.
“The Tech sector is undergoing major changes due to an evolving landscape. New technologies are changing the way people work and often make workplaces more efficient. In addition to potential staffing changes, there may be differences within the leadership and board ranks regarding exactly which path a company will take. In fact, we have tracked the highest number of chief executive officer changes in the Tech sector on record this year,” said Challenger.
Indeed, 181 chief executives have left their posts in the Technology sector through October this year, the latest month for which we have data. That is 46% higher than the 124 Tech CEOs who left their posts through October 2018, and 19.1% higher than the 152 Tech CEOs who left their posts during the whole of 2018. The next-highest year for Tech CEO turnover occurred in 2006, when 163 CEOs left Technology companies.*
Health Care companies, including hospitals and medical products manufacturers, announced the second-highest total in November, with 6,247, the highest monthly total for the sector since January 2018, when 6,531 cuts were announced. Hospitals and other patient care facilities, such as nursing homes and psychiatric facilities, cited lower Medicare and Medicaid reimbursements, declining revenue, and the changing care landscape.
Retail continues to lead all sectors in 2019 with 74,686 cuts, 3,201 of which occurred in November. Industrial Goods manufacturers follow with 68,141, 173% higher than the 24,960 announced through November last year. It is the highest January-October total for the sector since 2009, when 107,895 cuts were announced.
Automotive companies have announced 47,518 job cuts this year, 66.6% higher than the 28,529 announced through the same point last year. Challenger tracked 14,000 job cuts announced by General Motors in the Automotive sector one year ago in November. It is the highest total in the first 11 months of the year since 2009, when 165,281 cuts were recorded.
Meanwhile, hiring plans by U.S.-based employers are at a record high. Through October, companies have announced 1,181,438 hiring plans, 564,781 of which are for the holiday season (Table 8).
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Note: Challenger has updated the names of two industries to better describe the companies that are tracked therein. “Computer” will now be labeled “Technology” and “Commodities” will now be called “Mining.”
Challenger is also breaking out Financial Tech firms, which will be referred to as “FinTech.” These changes are represented in Table 2 (Job Cuts by Industry) and Table 7 (Announced Hiring Plans).