More than 75 employers accepted resumes and spoke to potential hires at a career fair in Lake Forest, California on Wednesday, February 21, 2024.
Paul Bersebach | Medianews Group | Orange County Register | Getty Images
Layoff announcements in February reached their highest level since the global financial crisis that month, according to outplacement firm Challenger, Gray & Christmas.
The total 84,638 planned cuts represented an increase of 3% from January and 9% from the same month last year, with technology and financial companies leading the way.
Historically, this was the worst February since 2009, when there were 186,350 announcements as the worst part of the financial crisis appeared to be coming to an end. The following month, financial markets bottomed out, paving the way for the longest economic expansion on record, which lasted until the Covid pandemic in March 2020.
For the year, companies recorded 166,945 retrenchments, a decline of 7.6% from the previous year.
“As we navigate the start of 2024, we are experiencing a sustained wave of layoffs,” said Andrew Challenger, the company’s labor and workplace expert. “Companies are aggressively cutting costs and embracing technological innovation, measures that are significantly changing workforce needs.”
With a series of high-profile waves of layoffs, the tech sector is leading the way with 28,218 job cuts this year, although that number is down 55% compared to the same period last year. Layoff announcements at financial firms are up 56% compared to the first two months of 2023.
Other industries planning significant cuts include capital goods manufacturing (up 1,754% year over year), energy (up 1,059%) and education (up 944%).
However, the layoff numbers do not affect weekly jobless claims, suggesting that unemployment is short-lived and workers are able to find new jobs. Initial unemployment insurance claims totaled 217,000 last week, unchanged from the previous period and right in line with Wall Street estimates.
Challenger experts say companies most often cite restructuring plans as the main reason for downsizing. Artificial intelligence was cited for just 383 cuts, although “technological upgrades” were generally the cause of more than 15,000 cuts, almost as many as in all years combined since 2007.
“In fact, companies are implementing robotics and automation alongside AI. “It’s worth noting that AI was directly cited in 4,247 job cuts last year alone, indicating a growing impact on companies’ workforces,” Challenger reported.
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2024-03-07 18:30:18
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