Survey: U.S. Firms Ease Up On Job Cuts

By Agence France-Presse U.S. companies sharply scaled back plans to cut jobs in May, raising hope for a turnaround in the stagnant labor market, an industry survey showed June 3. Employers announced a 30-month low of 68,623 job cuts in May, down 53% from April, said the survey by outplacement firm Challenger, Gray and Christmas Inc. "The missing-in-action kick start that will propel the economy out of the doldrums may be close at hand," says John Challenger, CEO of the Houston-based outplacement firm. "Small and medium businesses, traditionally responsible for most new job creation in recoveries, may begin to expand investment and hiring due to the new tax cuts." Job creation numbers may show a recovery when unemployment figures for May are released Friday, but the outlook for the underlying economy remained uncertain, Challenger says. "The character of the economy in the last year has been start-and-stop. Right now, the overall job-cut trend is downward," he says. "It is highly likely that companies will now take a breather, with the job-cutting frenzy of the last three months abating," he forecasts. Workers in the transport industry were hardest hit, with 9,226 job cuts announced, followed by the government/non-profit sector with 9,180 and industrial goods with 7,176, the survey showed. In April, the unemployment rate rose to 6.0% from 5.8% in March as war-shaken businesses axed 48,000 jobs, government figures showed last month. Copyright Agence France-Presse, 2003