US job cuts soared in April to the most ever as the Covid-19 lockdown devastated the economy. The damage to working class and middle America, the engine of the American economy is unprecedented.
US job cuts soared in April to the most ever as the Covid-19 lockdown devastated the economy. The damage to working class and middle America, the engine of the American economy is unprecedented.
While not a surprise, the severity underscores the impact that many seem oblivious to.
Global outplacement and executive and business coaching firm Challenger, Gray & Christmas, Inc. has tracked over 9,000 job cut announcements due to the COVID-19 outbreak. They reported that a total of 671,129 job cuts were announced lin April. In that total 633,082 job cuts related to the coronavirus pandemic.
The job cuts in March were 222,288 job cuts announced. Meaning almost 1 million job cuts in 2 months. Job cuts were across most sectors.
- April’s total is 202% higher than the 222,288 job cuts announced in March and 1,577% higher than the 40,023 cuts announced in the same month last year.
- It is 170% higher than the previous record monthly total of 248,475 job cuts tracked in January of 2002.
- So far this year, 1,017,812 job cuts have been announced, 342% higher than the 230,433 announced in the first four months of 2019.
- It is the highest January-April total on record, and 43% higher than the previous record January-
- April total of 711,100 announced in the first four months of 2009.
“No doubt employers have every intention of bringing back workers once the immediate crisis passes, but the indefinite nature of this pandemic coupled with the fact that we’re seeing recession- or even depression-level economic data means the vast majority of these jobs will not return any time soon,” said Andrew Challenger, Senior Vice President of Challenger, Gray & Christmas, Inc.
“The longer people are out of work, the less money they have to spend. The longer people feel unsafe going out and spending, the less likely many small and midsize businesses will keep people on the payroll,” he added.
Prior to the last two months, individual job cut events in a given month averaged 252. In April, Challenger tracked nearly 2,600 job cut events after 1,070 in March.
Where The Job Losses Were
- Vast majority of cuts in the Entertainment/Leisure sector, which includes bars, restaurants, hotels, and amusement parks. So far this year, these companies have announced 415,206 cuts, 5,783% higher than the 7,058 announced in the first four months of 2019; 400,985 of these cuts were due to COVID-19.
- Retailers have announced the second-highest number of job cuts this year with 114,327, 86,982 of which are due to COVID-19. This is 138% higher than the 48,076 cuts announced through the same period last year.
- The Services sector, which includes companies that provide catering, linen, marketing, and administrative services, announced 73,137 cuts in 2020, 811% higher than the 8,032 cuts announced through the same period in 2019.
- The Automotive sector, including makers, suppliers, and dealers, which prior to the pandemic was seeing fallout from a trade war, shifting consumer behavior, and automation, has cut 56,292 jobs in 2020, up 184% from the 19,802 cuts announced through April last year.The COVID-19 pandemic is not the only cause for job cuts, although it is the reason for the vast majority.
- The ongoing downturn in oil was cited for 10,041 cuts in April and a total of 11,310 for the year. Company and plant closings have claimed 60,959 jobs this year. Restructuring was blamed for another 46,751 cuts, and market conditions claimed another 19,672.
Source: Challenger, Gray & Christmas
From The TradersCommunity News Desk