Changes in consumer finance led to a 44 percent surge in job cut announcements in September, as U.S.-based employers planned to cut 55,285 from their payrolls, according to global outplacement and executive coaching firm Challenger, Gray & Christmas, Inc.
Last month’s total is 43.7 percent higher than the 38,472 cuts announced in August and 70.9 percent higher than the 32,346 cuts announced in the same month last year. September job cut plans are the second highest monthly total behind March, when 60,357 cuts were recorded.
Nearly half (47.9 percent) of September job cuts come from Wells Fargo’s announcement that it will cut between 5 and 10 percent of its workforce over the next three years. With roughly 265,000 workers, the company plans to cut up to 26,500 (Challenger counted the higher figure in its tracking).
“As the job market remains near full employment and companies struggle to find workers, large-scale job cut announcements like the one from Wells Fargo will actually provide the workers necessary for companies to gain momentum and sustain growth,” said John Challenger, Chief Executive Officer of Challenger, Gray & Christmas, Inc.
“With the exception of Wells Fargo, low job cut announcements indicate employers are holding on to their staff in a period of expansion,” he added.
Despite low announcements, job cuts are up year over year. Employers have announced 366,058 cuts so far this year, 13.9 percent more than the 321,478 cuts announced in the first nine months of 2017. Employers announced plans to cut 120,879 jobs in the third quarter, 15.3 percent higher than the 104,800 announced in the second quarter and 27.9 percent higher than the 94,479 announced in the same quarter last year.
While the Financial sector announced the most cuts in September with 27,343, most of which are due to increased demand for online banking options, Retailers similarly continue to announce cuts as consumers pivot to online shopping, with Retail leading all sectors in job cuts. So far this year, Retail companies have announced 85,385 cuts, 12,319 of which occurred in the third quarter.
Industrial Goods manufacturers announced the third highest number of job cuts in September with 2,235, bringing the year-to-date total to 20,699, 32.9 percent higher than the 15,565 cuts announced through September last year.
Meanwhile, companies in Retail, Transportation, and Warehousing announced large-scale seasonal hiring plans last month. So far this season, Challenger has tracked plans to hire 589,118 seasonal workers this year. This is in addition to the 6,879 hiring plans employers announced in September.Download Resource