February 2023 Challenger Report
Published March 9, 2023
In the shortest month of the year, U.S.-based employers announced 77,770 job cuts in February, down a 24% from the 102,943 cuts announced in January. It is 410% higher than the 15,245 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.
February’s total is the highest for the month since 2009, when 186,350 cuts were recorded. So far this year, employers announced plans to cut 180,713 jobs, up 427% from the 34,309 cuts announced in the first two months of 2022. It is the highest January-February total since 2009 when a total of 428,099 job cuts were announced in January and February.
“Certainly, employers are paying attention to rate increase plans from the Fed. Many have been planning for a downturn for months, cutting costs elsewhere. If things continue to cool, layoffs are typically the last piece in company cost-cutting strategies,” said Andrew Challenger, Senior Vice President of Challenger, Gray & Christmas, Inc.
“Right now, the overwhelming bulk of cuts are occurring in Technology. Retail and Financial are also cutting right now, as consumer spending matches economic conditions. In February, job cuts occurred in all 30 industries Challenger tracks,” he added.
In fact, Challenger has not recorded announcements in every industry the firm tracks since January 2013, when cuts occurred in all 29 industries. The firm did not track FinTech until 2019.
WHICH SECTORS ARE CUTTING JOBS?
Technology companies cut the most jobs last month with 21,387, 28% of all cuts announced in February. The industry has cut a total of 63,216, up 33,705% from the 187 cuts announced in the same period last year. This sector has announced 35% of all job cuts in 2023.
The Health Care/Products space, which includes hospitals and health care products manufacturers, announced the second-most cuts in February with 9,749, for a total of 16,482 this year. That is an 85% increase from the 8,928 cuts announced during the same time last year.
“While many hospitals are still struggling to retain and attract staff, others are cutting costs as economic conditions continue to soften. Meanwhile, manufacturers of health care products are dealing with the increasing costs of doing business, and cutting back staff,” said Challenger.
Retail, Financial, Fintech
Meanwhile, Retailers have announced 17,456 cuts so far in 2023, up 2,194% from the 761 job cuts announced in the sector during the same period in 2022. Financial firms have cut 17,235, 1,401% higher than the 1,148 cuts announced in January and February last year.
In the first two months of the year, Fintech has announced 4,675 cuts, 45% of the 10,476 the industry cut in all of 2022.
Media & News
The Media industry has announced plans to cut 9,738 jobs so far in 2023, up 158% from the 3,774 cuts announced in the sector in all of last year. Of those, 906 occurred in digital, print, and broadcast News, which Challenger tracks as a subset of Media, 546 of which occurred in February. This is up 353% from the 200 News cuts which occurred through February 2022.
HIRING PLANS FALL
Companies announced plans to hire 28,830 workers in February, down 12% from the 32,764 hires announced in January. It is down 87% from the 215,127 hiring plans announced by companies in February 2022. So far this year, companies announced plans to hire 61,594 workers, the lowest January-February total since 2016, when employers planned to hire just 15,901 workers in the first two months of the year.
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