August 2022 Job Cut Announcement Report
Challenger, Gray & Christmas, Inc.
PUBLISHED September 1, 2022
Job Cuts Fall 21% In August From July, Up 30% From August 2021
U.S.-based employers announced 20,485 cuts in August, a 21% decrease from the 25,810 cuts announced one month prior. It is 30% higher than the 15,723 cuts announced in the same month last year, according to a report released Thursday from global outplacement and business and executive coaching firm Challenger, Gray & Christmas, Inc.
August marks the fourth time this year that cuts were higher in 2022 than in the corresponding month a year earlier.
So far this year, employers announced plans to cut 179,506 jobs, down 27% from the 247,326 cuts announced in the first eight months of 2021. It is the lowest recorded January-August total since Challenger began tracking monthly job cut announcements in 1993*.
Labor Market Data Remains Strong
“Employment data continue to point to a strong labor market. Job openings are high, layoffs are low, and workers seem to have slowed their resignations. If a recession is imminent, it’s not yet reflected in the labor data,” said Andrew Challenger, Senior Vice President of Challenger, Gray & Christmas, Inc.
The Technology sector led all industries in August with 5,081, nearly a quarter of all cuts announced during the month. Technology companies have announced 14,408 cuts so far this year, up 70% from the 8,479 cuts announced through the same period last year.
Meanwhile, cuts in the Financial Technology (Fintech) sector have increased 765% over last year, from 563 through August 2021 to 4,870 cuts through the same time this year.
The Automotive sector leads all industries this year with 28,701, a 232% increase from the 8,639 cuts announced in the sector through August 2021.
“Auto makers are pivoting to more eco-friendly options as demand increases, while recent legislation has reinforced these changes will occur even more quickly,” said Challenger.
Indeed, the Inflation Reduction Act includes a $7,500 tax incentive for new electric vehicles and $4,000 for used. Meanwhile, the California Air Resources Board voted to outlaw new sales of gas powered cars and light trucks by 2035.
Health Care/Products, which includes hospitals, providers, and health care products manufacturers, has announced 21,292 cuts this year, up 31% from the 16,263 cuts announced in this sector in the same time last year.
The majority of cuts this year (41,948) were due to “cost-cutting” while 32,705 were due to plant, unit, or store closings. Another 27,178 cuts were attributed to market conditions. This year, 10,465 cuts were due to employees refusal to take the vaccine, all of which occurred in the first quarter of the year.
Hiring Announcements by U.S. Employers
Employers announced plans to hire 41,985 workers in August, up 65% from the 25,506 announced hiring plans in July. It is down 55% from the 94,004 announced in August 2021. So far this year, employers announced plans to hire 783,074 workers, an 18% increase from the 664,074 plans announced during the same period last year.
*From 1989-1992, an outside newsletter tracked job cut announcements.
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U.S. labor market, manufacturing resilient despite rising interest rates
Published on September 2, 2022
A separate report from global outplacement firm Challenger, Gray & Christmas on Thursday showed job cuts announced by U.S.-based employers fell 21% to 20,485 in August. Though layoffs rose 30% from a year ago, they were down 27% in the first eight months of this year compared to the same period in 2021. The technology industry accounted for nearly a quarter of the job cuts announced in August. Technology companies have announced 14,408 layoffs so far this year, a 70% surge from the same period last year. Overall, employers announced plans to hire 41,985 workers in August, up 65% from July.Download Full Report