January Job Cuts Rise 200%

The outplacement firm of Challenger, Gray & Christmas released its job-cuts report for January, indicating that layoffs skyrocketed by more than 200% to their highest level since last summer. The massive cuts in jobs were mostly due to an announced layoff of about 16,000 workers at Wal-Mart and some 4,800 firings at Macy’s.

Announced January layoffs totaled 75,114, up from a 15-year low of 23,622 in December 2015. Compared with January 2015, the 2016 total is up 42%.

The retail sector announced job cuts of 22,246 in January, the highest retail total since January 2009, when announced cuts totaled 53,968.

Layoffs in the energy sector totaled 20,103 in January, led by new cuts announced by Halliburton, Baker Hughes, and Schlumberger, the country’s three largest oilfield services firms. The total job cuts in January are essentially flat with January 2015’s announced cuts. The January 2016 total announced job losses were 20,193, making last month the second-highest ever in Challenger’s records.

Challenger, Gray & Christmas CEO John Challenger said:

The pace of downsizing in the energy sector ebbed in the second half of 2015, but the latest activity … is evidence the industry is far from concluding its cost-cutting initiatives. With oil prices expected to stay low for the foreseeable future, the potential for continued layoffs remains elevated. … Retail job cuts came on the heels of a relatively strong holiday sales, which increased by nearly 8.0 percent. However, a growing portion of the sales gains are occurring online. At Macy’s, for example, November and December sales at its brick-and-mortar stores fell by about 5.0 percent, while orders through its online entities were up 25 percent from a year earlier, according to reports

On the brighter side, announced hiring plans for January totaled 8,362 new hires. According to Challenger, the United States added more than 690,000 jobs in 2015, compared to about 599,000 job cuts.