A report from Challenger, Gray & Christmas, a firm that provides outplacement services to executives, reveals that in the past two months, a number of companies in the United States have cut jobs due to concerns over a global recession, resulting in more than 180,000 employees losing their jobs. In January, US companies cut 1,02,943 jobs, while 77,770 staff cuts were made in February. Among them, technology companies cut 21,387 jobs in February, accounting for 28% of all cuts.
The report also shows that the tech industry has cut a total of 63,216 jobs, up 33,705% from the 187 cuts announced in the same period last year. According to Andrew Challenger, who is the Senior Vice President of Challenger, Gray & Christmas, Inc., a lot of companies have been preparing for an economic slowdown for several months by reducing expenses in other areas. If the situation worsens, job cuts are usually the final measure in a company’s cost-cutting plan.
The Health Care/Products sector, which comprises hospitals and manufacturers of healthcare products, announced the second-largest number of job cuts in February with 9,749, bringing the total for the year to 16,482. This represents an 85% increase from the 8,928 layoffs announced during the same period last year. In 2023, retailers have already announced 17,456 job cuts, an increase of 2,194% compared to the 761 job cuts announced in the same period in 2022. Similarly, financial companies have cut 17,235 jobs, an increase of 1,401% compared to the 1,148 cuts announced in January and February last year.
Furthermore, Fintech has announced 4,675 cuts in the first two months of the year, which is 45% of the 10,476 that the industry cut in all of 2022. The media industry has also announced plans to cut 9,738 jobs this year, up 158% from the 3,774 cuts announced in the sector all of last year.
According to Challenger, the job cuts in the US are happening as companies keep a close watch on the Federal Reserve’s decisions to raise interest rates. Challenger noted that at present, most of the job cuts are taking place in the Technology sector, while the Retail and Financial industries are also implementing staff reductions in line with current economic conditions.
Q1:What industries have seen the highest number of job cuts in the US?
The technology industry has seen the highest number of job cuts, accounting for 28% of all cuts, with 21,387 jobs cut in February alone. Retail and financial industries are also implementing staff reductions.
Q2: What is the reason for the job cuts in the US?
Companies are monitoring the Federal Reserve’s decisions to raise interest rates and have been preparing for an economic slowdown by reducing expenses in other areas. If the situation worsens, job cuts are usually the final measure in a company’s cost-cutting plan.