Published October 3, 2024
U.S.-based employers announced 72,821 cuts in September, a 4% decrease from the 75,891 cuts announced one month prior. It is up 53% from the 47,457 cuts announced in the same month in 2023, according to a report released Thursday from global outplacement and business and executive coaching firm Challenger, Gray & Christmas, Inc.
In the third quarter, companies announced plans to cut 174,597 jobs, down 16% from the 177,391 cuts announced in the second quarter of this year. It is up 19% from the 146,305 cuts announced in the same quarter of 2023.
For the year, companies have announced 609,242 job cuts, up 0.8% from 604,514 announced during the same period last year. Though less than a percentage point separates them, this is the first time this year that year-to-date cuts are higher than those tracked during the same period in 2023.
“We’re at an inflection point now, where the labor market could stall or tighten. It will take a few months for the drop in interest rates to impact employer costs, as well as consumer savings accounts. Consumer spending is projected to increase, which may lead to more demand for workers in consumer-facing sectors.
“Layoff announcements have risen over last year, and job openings are flat. Seasonal employers seem optimistic about the holiday shopping season. That said, many of those who found themselves laid off this year from high-wage, high-skill roles, will not likely fill seasonal positions,” said Andrew Challenger, Senior Vice President of Challenger, Gray & Christmas, Inc.
Indeed, the latest Job Openings and Labor Turnover Survey (JOLTS) from the Bureau of Labor Statistics (BLS) showed job remained flat in August, while hiring and quits fell.
Which Industries are Cutting Workers?
Technology
Last month, Technology announced the most job cuts of any sector with 11,430. For the year, Technology announced 116,858, down 23% from the 151,989, announced through the same period last year.
“A large percentage of job cuts this year have come from the Tech sector. Those reductions often come with generous severance packages, as well, meaning many of these workers could afford to stay out of the labor market for a while and continue to spend,” said Challenger.
Of the top industries, only Government is cutting at a faster pace than last year, primarily on a cut to the armed services. Tech, Healthcare, Services, and Financial firms, are generally cutting fewer workers than last year. However, a number of industries are cutting well above the pace of last year.
Utilities and Energy
Utilities have announced 8,879 cuts so far this year, up 691% from the 1,112 cuts announced through the same period last year. Energy, meanwhile, has announced 359% more cuts: 8,315 vs. 1,811 in 2023.
Apparel
Clothing manufacturers announced 7,725 job cuts through the third quarter of this year, up 270% from the 2,090 layoff announcements recorded last year.
Transportation and Industrial Manufacturing
Companies that transport people and goods have announced 25,263 cuts this year, an increase of 248% from the 7,257 cuts announced during the same period last year. Industrial Manufacturers have announced 19,794 job cuts, up 248% from the 5,934 announced during the same period last year.
Education and Entertainment/Leisure
Education has announced 220% more cuts in 2024 compared to the same period last year: 25,285 vs. 8,126. Entertainment/Leisure companies have cut 31,054 through Q3 2024, up 136% from the 13,141 cuts announced in the sector through September 2023.
Media & News
The Media industry, which includes television, film, streaming, and News, announced 12,914 job cuts so far this year, down 34% from the 19,413 announced in the industry through September 2023.
News, which includes digital, broadcast, and print, and is tracked as a subset of Media, announced 300 layoff announcements in September. For the year, News has announced 3,402, up 40% from the 2,423 cuts tracked during the same period last year.
Why Are Companies Cutting?
Last month, 15,750 job cuts were attributed to “Cost-Cutting,” while 14,054 were due to store, unit, or department “Closing.”
Artificial Intelligence (AI) was cited for 5,616 job cuts last month, all of which occurred in Technology, for a total of 12,742 this year. Since this reason was first tracked in May 2023, 16,989 cuts have been due to AI.
U.S. employers announced 403,891 hiring plans in September, with 401,850 coming from seasonal employers, both in Retail and Transportation/Warehousing (Table 8). This is down 32% from the 590,353 hiring plans announced in September of last year. Of September 2023 hiring plans, 552,800 were seasonal.
For the year, employers have announced plans to add 483,590 jobs, down 33% from the 726,333 announced hiring plans through September 2023. These are the lowest YTD hiring plans since 2011, when employers planned to add 300,794 jobs through September.
NOTE: In early October, Dick’s Sporting Goods announced 8,000 seasonal hires, down from 8,600 announced last year. Amazon announced 250,000 seasonal hires, the same number as last year.
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Contact Colleen Madden Blumenfeld for more data or to set up an interview with SVP Andy Challenger.
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