March 2021 Challenger Job Cuts Report
Published April 1, 2021
Job cuts announced by U.S.-based employers fell 86% in March to 30,603 from the 222,288 job cuts announced in the same month last year, when the fallout from the COVID-19 lockdowns began to impact businesses across the country, according to a report released Thursday from global outplacement and business and executive coaching firm Challenger, Gray & Christmas, Inc.
March’s total is 11% lower than the 34,531 cuts announced in February. It is the lowest monthly total since July 2018 when 27,122 cuts were recorded. Through the first quarter, 144,686 job cuts have been announced, 58% lower than the 346,683 announced in the first quarter of 2020.
“We have now marked one year since the first wave of layoffs occurred due to the pandemic and subsequent lockdowns. It appears we have entered a recovery phase where job eliminations are slowing and companies are able to predict and assess where growth will occur,” said Andrew Challenger, Senior Vice President of Challenger, Gray & Christmas, Inc. (Related: Future of work post-2020 survey results)
The first quarter total is 35% lower than the previous quarter, when 222,493 job cuts were planned. It is the lowest first quarter total since 2018, when 140,379 cuts were announced, and the lowest quarterly total since Q4 2019, when 127,687 cuts were announced.
Hiring plans are also down this year from the first quarter of last year. Through March 2021, employers have announced plans to add 316,233 jobs, down 66% from the 936,041 added in the first quarter of 2020, 824,610 of which were announced in March.
“While companies were cutting the first wave of positions due to the pandemic, grocers, delivery apps, big box retailers, and warehouses were adding hundreds of thousands of jobs to keep up with the demand of online shopping,” said Challenger.
Indeed, the hiring plans in March 2020 were the second-highest for monthly hiring announcements, surpassed only by September of that year, when hiring announcements for the month hit 929,860. (Related: December 2020 retail hiring surge pushes past 2019 level)
What Industries Lead Downsizing
Through March of this year, job cuts were led by companies in the Aerospace/Defense industry, which has announced 31,073 cuts. This is 338% higher than the 7,090 cuts announced through the same period last year. Telecommunications follows with 24,157 cuts, up 112% from the 11,409 cuts announced last year, as companies in this sector pivot to new technologies.
Retail has announced 11,932 job cuts so far this year, down 60% from the 29,825 cuts announced through March 2020. Entertainment/Leisure companies, which announced 96,887 job cuts through March 2020, plan to cut 9,866 jobs so far this year, a 90% decrease.
Layoffs in News and Media
Challenger continues to follow losses in the News industry, which is tracked as a subset of Media cuts. Newsrooms cut 542 jobs in March, for a total of 874 cuts this year. That is down 37% from the 1,390 cuts through March 2020. These cuts include digital, print, and broadcast news. Newsrooms cut 16,160 jobs in 2020, the highest total on record and up 13% from the previous high of 14,265 in 2008. (Related: Newsrooms suffer worst layoffs through June on record)
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Rise in U.S. weekly jobless claims belies improving labor market conditions
Indeed, a third report from global outplacement firm Challenger, Gray & Christmas showed planned layoffs by U.S.-based companies dropped 11% to 30,603 in March, the fewest since July 2018. Through the first quarter planned layoffs plunged 35%, compared the October-December period. At 144,686, job cuts last quarter were the fewest since the fourth quarter of 2019.
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— Reuters (@Reuters) April 1, 2021