By Bryan Jung
Despite a strong jobs market report earlier this week, October saw the largest amount of monthly job cuts since February 2021.
Many American companies are expecting an economic downturn heading into the fourth quarter, leading to fears that more cuts are likely to come.
The U.S. labor market has remained strong this year, despite scattered of layoffs, with certain sectors taking a beating, as the Federal Reserve raised its benchmark rate again on Nov. 2
The Fed raised interest rates by 75 basis points in its fight against inflation, but it suggested that it may be nearing an inflection point, after the quickest annual rate tightening in 40 years.
Fed Chairman Jerome Powell announced that the labor market “remains extremely tight” and “continues to be out of balance.”
Employers Begin Feeling an Economic Squeeze in Fourth Quarter 2022
The job placement agency Challenger, Gray & Christmas released a report on Nov. 3, which revealed that American-based firms announced 33,843 job cuts last month, up from 29,989 in September.
This is higher than the same month last year, when 22,822 employees were laid off.
The level of job cuts in October was the highest on record since 34,531 employees were terminated in February 2021.
This is the sixth time this year that job cuts were higher in 2022 than the same month in 2021.
“We are beginning to see more job cut activity in the fourth quarter, historically when the bulk of cuts occur, as companies finalize budgets and plans,” said Andrew Challenger, senior vice president of Challenger.
“Many companies are anticipating a downturn, and with a still-tight labor market and the Fed’s rate hikes, more cuts will be on the way as we enter 2023.”
However, there were a total of 243,338 in layoffs for the first three quarters of 2022, which was 16 percent lower than the 288,043 in cuts announced for the same period in 2021.
The outplacement service said that was the lowest number recorded for the January–October period since it started tracking monthly job cuts announcements in 1993.
Tech companies experienced the most layoffs last month, at 9,587, for a total of 28,207 job cuts this year, up 162 percent from the same period in 2021.
Meanwhile, there were reports that Elon Musk announced plans to layoff nearly 50 percent of Twitter’s workforce by the end of this week, in a majoring restructuring of the company since he took over the social media platform.
The automotive industry saw the largest annual job cuts, with 28,987 laid off in 2022, an increase of 182 percent over the 10,005 cuts announced during the same period in last year.
The other two sectors facing large cuts year were real estate and construction, at 7,206 and 3,983, respectively, due to a collapsing housing market.
“The housing market has cooled as interest rates scare off new buyers. Housing starts and permits have both fallen from last year, according to government figures,” said Challenger.
“There is still no indication that layoffs are picking up in any meaningful way,” said Dante DeAntonio, senior economist at Moody’s Analytics to Reuters.
“The ongoing lack of layoffs will help propel consumer spending moving forward even as household balance sheets come under pressure from high inflation.”
Companies Plan for the Holiday Hiring Season
The most common reasons for job cuts listed in the report were over business closings, restructuring, and cost-cutting, while about a third of businesses listed no single cause.
Companies announced plans to hire 237,380 workers in October, including 194,130 in the retail sector, in anticipation of the holiday season, according to the report.
This was after hiring in September was the lowest on record since 2011.
Hiring announcements over the last two months were well below the same period in 2020 and 2021, as employers remained concerned about the short-term economic outlook heading into the holidays.
Meanwhile, the weekly jobless claims Nov. 3 report from the Labor Department showed claims falling to 217,000, while continued claims increased to 1.485 million.
Economists are also eagerly awaiting the department’s separate October jobs report, which is to be released on Nov. 4. It is projected to show only 205,000 new hires, after a gain of 263,000 in September, according to economists surveyed by Reuters.
Reuters contributed to this report.
Affiliate News Feeds
- Washington Examiner
- The Federalist
- The Epoch Times
- The Guardian
- The Gateway Pundit
- Judicial Watch
By Naveen Athrappully NASA announced on Tuesday that it intends to cancel the development of its GeoCarb mission, which was proposed to be a low-cost satellite aimed at monitoring greenhouse gas… [...]
By Bryan Jung The rate of job cuts in the United States soared 127 percent in November, amid a wave of layoffs in the tech industry. The American employers announced 76,835 cuts… [...]
By Jennifer Margulis and Joe Wang What medicine should you take? How should you treat any given illness? What preventative measures are most effective for you? Which vaccines do you need? These… [...]
A former professor at the University of California San Diego said she gave all of her students "A" grades and no homework in a recently unearthed video. [...]
A key Senate vote over whether to provide paid sick leave for rail workers is highlighting a divide within the GOP, a party that has increasingly tried to position itself… [...]
Transmission infrastructure will need to double or triple to accommodate the growth. [...]
Anyone still wearing a face mask to protect himself from Covid probably has no intention of ever shedding it now. [...]
Anyone who actually watched 'Wednesday' can see that the 'racism' accusations are ridiculous and performative. [...]
Chuck DeVore's historical fiction book 'Crisis of the House Never United: A Novel of Early America' demonstrates not only why procedure and patience matter, but also the genius of the… [...]
The head of the largest oil and natural gas trade association warned that failure to replenish the U.S. Strategic Petroleum Reserve (SPR) could trigger another oil crisis in the coming… [...]
This episode will premiere on Friday, Dec. 2 at 8 p.m. ET. In this episode of Kash’s Corner, we discuss the impending release of the Jan. 6 committee’s final report.… [...]
New York’s quest to replace the troubled Rikers Island jail complex with smaller facilities across the five boroughs could lead to either hazardous overcrowding or the release of dangerous detainees,… [...]
Health Security Agency issues rare alert over rise in cases, urging people to seek immediate medical help if they see symptomsQ&A: what are the symptoms and how can strep A… [...]
Exclusive: Labour says ministers have been told repeatedly that people with prepayment meters are not getting enough supportCase studies: ‘I can’t afford to heat my son’s room’Up to half a… [...]
Joe Biden’s gender fluid “pup handler” DOE employee Sam Brinton was charged with felony theft for stealing a woman’s luggage last month at MSP airport in Minnesota. According to Alpha… [...]
By Wayne Allyn Root Let me start with a disclaimer. I’m a Jew. Not just any Jew. Ancestery.com tested my DNA and reported I’m 99.9% Eastern European Jewish ancestry. That’s… [...]
The Department of Homeland Security has issued a National Terrorism Advisory System Bulletin in advance of the holidays. The United States remains in a heightened threat environment. Lone offenders and… [...]
From Fox News: The Secret Service will not say why they changed their position regarding a government watchdog’s records request into Hunter Biden’s gun investigation records. Government watchdog Judicial Watch… [...]
(Washington, DC) – Judicial Watch announced today that the United States Secret Service has repeatedly changed its position about whether it is in possession of records related to the investigation… [...]
The Biden administration is giving a nonprofit partially funded by leftwing billionaire George Soros’s Open Society Foundations (OSF) $12 million to strengthen labor rights and empower workers in three Latin… [...]