U.S. Job-Cut Rate Hits Lowest Level Since 2000

Layoffs increase in June, but 2011 is on pace to reach new low.

So far, 2011 is shaping up as one of the slowest years for downsizing activity in over a decade, according to a report released July 6 by global outplacement consultancy firm Challenger, Gray and Christmas Inc.

But the good news was tempered a bit after the number of planned layoffs rose in June, the second-consecutive monthly increase.

Employers said they planned to cut 4,297, or 11.6 %, more jobs in June than the previous month, the firm reports. Layoffs in May were up 2% after falling to a four-month low in April.

The aerospace and defense industry contributed to the largest number of job cuts. The sector has experienced a 241% rise in job cuts in 2011to 20,851 layoffs.

Even so, the rise in layoffs did not have a major impact on the slowing pace of downsizing, says John Challenger, CEO of Challenger, Gray and Christmas.

"The employment picture remains a bit cloudy," he says. "Continued slowness in the pace of job cuts is certainly promising. However, hiring is coming in spurts and is not quite robust enough to make a significant dent in unemployment."

A clearer picture of where the year is headed will materialize in the next three or four months of employment and hiring data, Challenger says.

TAGS: The Economy
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