U.S. Layoffs Surge 53% in September Amid Economic Uncertainty
In a concerning trend for the American labor market, recent data reveals that U.S. layoffs surged by 53% in September compared to the same month last year. According to a report from Challenger, Gray & Christmas, nearly 73,000 job cuts were announced last month, a slight decrease from August's five-month high of 75,891 but significantly higher than September 2023.
The cumulative layoffs for the first nine months of 2024 reached 609,242, marking a 0.8% increase year-over-year and surpassing the previous year's total for the first time this year. This is the highest figure recorded since 2020 when over 2 million layoffs were announced between January and September. Key sectors contributing to these figures include technology, entertainment and leisure, education, transportation, and manufacturing.
The report attributes these layoffs to several factors, including cost-cutting measures, business closures, and the rising influence of artificial intelligence. Andrew Challenger, the firm’s senior vice president, stated, “We’re at an inflection point now, where the labor market could stall or tighten.” He added that layoff announcements are increasing, while job openings remain stagnant.
This wave of layoffs follows significant cuts from major corporations this summer. Intel announced the termination of 15,000 employees, Cisco let go of 56,000, and Intuit cut 1,800 jobs, among others.
Stalled Labor Market
Despite the layoffs, the U.S. labor market is experiencing a period of stagnation, with employers neither hiring nor firing at significant rates. Bill Adams, chief economist for Comerica Bank, noted that the number of hires has remained relatively stable at 5.3 million, with separations flat as well. However, the Job Openings and Labor Turnover Survey (JOLTS) report indicated an unexpected rise in job vacancies, exceeding 8 million for the first time since May.
As the September jobs report approaches, market analysts are preparing for the potential impact of economic factors such as Hurricane Helene and a significant port strike. Adams warns that these events may influence not just October’s employment figures but also retail sales and jobless claims data, complicating the economic outlook.
The U.S. economy is expected to add approximately 140,000 new jobs in September, with the unemployment rate anticipated to remain steady at 4.2%.
Retail Sector Hiring Boost
Looking ahead, the retail sector is showing signs of optimism as employers ramp up seasonal hiring in preparation for the holiday shopping season. Amazon recently announced plans to hire 250,000 workers for this busy period, while Target aims to bring on 100,000 seasonal employees. Macy’s is set to fill over 31,500 positions, and UPS intends to hire 125,000 workers to meet anticipated demand.
Deloitte forecasts a potential increase in holiday sales by 3.3% compared to last year, projecting total sales between $1.58 trillion and $1.59 trillion. Adobe also expects e-commerce sales to reach nearly $241 billion, with Cyber Week alone projected to account for one-fifth of online holiday sales.
However, Adams cautions that many individuals laid off from high-wage, high-skill roles may not fill these seasonal positions. The National Retail Federation reported a 3.8% increase in core retail sales during last year’s holiday season, highlighting the sector's resilience amid ongoing economic challenges.
As the U.S. navigates these turbulent waters, stay updated on the latest employment trends and economic news by following @dark_web24 for timely updates.