2019 Job Losses Soar at Automakers, Manufacturers, Tech Firms
The outplacement firm of Challenger, Gray & Christmas on Thursday released its job-cuts report for December. A total of 32,843 planned U.S. job cuts were announced in the month, a decrease of 26.3% compared with announced November cuts. Compared with cuts announced in December 2018, the latest total is 25.2% lower, the lowest announced total since July 2018. However, monthly totals were higher in eight months of 2019.
December’s cuts reduced the year-over-year total percentage increase from 13.1% in November to 10.0%. Employers announced 538,695 job cuts in 2018, compared with 592,566 in 2019. The announced total for this year is the fourth highest in the past 10 years.
Automakers cut 50,776 jobs last year, up 66% year over year, and industrial goods (manufacturing) companies announced 70,894 job cuts, a year-over-year increase of 156.5%.
For 2019, the hardest hit sector on a percentage basis is mining, where job cuts of 8,135 were nearly 1,300% higher than in 2018. The tech sector lost about 350% more jobs last year, 64,166, compared to 14,230 jobs lost in 2018, and the government sector announced 13,806 cuts, up nearly 190% year over year.
Andrew Challenger, vice president of the outplacement firm, said, “Confidence was high heading into the last month of the year. With some resolutions occurring in the trade war and strong consumer spending in the fourth quarter, companies appear to be taking a wait-and-see approach as we head into 2020.”
The industry hardest hit by job losses in 2019 was retail, where 77,475 job cuts were announced. The total, however, was more than 20% lower than the 98,563 cuts announced in 2018. These are the worst-performing retailers of 2019.
The transportation industry announced 4,115 job cuts in December, nearly four times the number of cuts in November, more than any other category.
Challenger commented: “The sectors with the highest number of cuts this year were all dealing with trade concerns, emerging technologies, and shifts in consumer behavior. We tracked a lot of hiring activity in these industries as well as cuts.”
While nearly 600,000 workers lost their jobs in 2019, Challenger reported that companies announced plans to hire nearly 1.21 million employees during the year. About 790,000 of those were hired for seasonal jobs.
For the full year, California (100,506), New York (61,575) and Massachusetts (37,133) lost the most jobs.
The top three reasons given for job cuts last year are restructuring (137,968 jobs cut), the business is closing (130,748) and bankruptcy (62,136). The Challenger report noted that the number of jobs lost due to bankruptcies last year was the highest since 2005, totaling just over 10% of all job cuts in 2019.
Next Friday, January 10, the U.S. Department of Labor is expected to report that U.S. employers added 165,000 jobs in December, a decrease of 38% compared with 266,000 jobs added in November.