Last month’s total is 27.8% higher than the 52,988 cuts announced in the same month last year. It is the highest total since February 2019, when employers announced 76,835 cuts.
Technology companies led in announced job cuts last month with 13,869, 1,828.9% higher than the 719 cuts announced in that sector in December 2019 and 2,073.4% higher than the 638 cuts from Technology firms announced in the same month last year. Technology companies cut 64,166 jobs in 2019, compared to 14,230 in 2018.
“We have seen large Technology companies shed workers as they pivot to new products or services. In some cases, long-standing, bellwether companies are reducing bureaucracy and removing layers of management to become nimbler,” said Andrew Challenger, Vice President of Challenger, Gray & Christmas, Inc.
“Tech is not the only industry embarking on this kind of restructuring. Companies across all industries are reexamining their hierarchies, particularly in Automotive and Retail, where innovations in technology are changing the landscape,” he added.
In fact, Retail announced the second-highest number of cuts, with 10,444, many due to bankruptcies. Of the 3,852 bankruptcy cuts last month, 2,631 were in Retail. Another 6,924 cuts in the sector were due to store closings.
Industrial Goods Manufacturers continue to shed workers, announcing 6,098 cuts in January, 1,740 of which cited the causes as market conditions and financial losses. Companies in this sector announced 70,894 cuts last year.
“Industrial Manufacturing continues to be in recession. This industry has been hit hard by slowing orders, lower corporate investments, and trade concerns over the last 12 months,” said Challenger.
The Automotive sector has felt the impact of trade concerns, technological innovations, and cutting bureaucracy as well. Automotive companies announced 5,437 cuts in January, after cutting 50,776 in all of 2019.
The Media, which announced 25,675 cuts between January 2018 and December 2019, announced 794 cuts in January, the highest monthly total since May 2019, when the industry announced 1,120 job cuts.
Companies cited restructuring for 22,424 job cuts last month. Plant or location closings accounted for 18,943. Financial losses were cited for 2,900 cuts, while market conditions caused 1,155. Tariffs were cited for 108 cuts, and the steel and coal downturns accounted for a combined 482.
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Job cuts announced by US-based employers surged 106% from December to 67,735 on tech, retail, industrial manufacturing. https://t.co/Z6gEM7UaF2 pic.twitter.com/vvkUNNx7Pm
— ChallengerGray (@ChallengerGray) February 6, 2020