Job cuts rose 15% in March as US based employers slashed 89.7K job cuts in March of 2023 the Challenger, Gray & Christmas report showed. This was up 319% above the 21.387K cuts a year earlier and 77.77K in February. Turmoil continues to grip the market with higher inflation and interest rates, global uncertainty and political missteps in the U.S. highlighted by the recent collapse of New York and California regional banks.
It was the third time this year that cuts were higher than the corresponding month a year earlier. Employers announced 270,416 job cuts in Q1, the highest first quarter total since 2020, and a 396% increase from the 55,696 cuts announced in the same period one year prior.
“We know companies are approaching 2023 with caution, though the economy is still creating jobs. With rate hikes continuing and companies’ reigning in costs, the large-scale layoffs we are seeing will likely continue,” said Andrew Challenger, Senior Vice President of Challenger, Gray & Christmas, Inc.
- Technology companies have announced 102,391 cuts so far in 2023, up 38,487% from the 267 cuts the sector announced in the first quarter of 2022.
- Financial companies announced the second-most job cuts this year with 30,635, a 419% increase from the 5,903 cuts announced in the sector in Q1 2022.
“The Technology sector is leading all industries, and this talent is in demand across industries. In fact, 38% of all cuts are in the Tech sector,” he added.
At the same employers announced plans to hire 9,044 workers in March, down from 28,830 in February and the lowest total for March since 2015. Considering Q1, there were 70,638 plans to hire, the lowest Q1 total since 2016.
Job Cuts Highlights
Industry sectors with the most dismissals
- Companies in the technology sector announced the most job cuts with 102,391 cuts so far this year, up 38,487% from the 267 cuts the sector announced in the first quarter of 2022. It is already up 5% from the annual total of 97,171 in 2022. It is on pace to surpass the highest annual total for the sector announced in 2001. The only years during which Tech announced more job cuts than the current year are in 2001, when 168,395 cuts were announced, and 2002, when 131,294 Tech cuts were recorded.
- Financial companies announced the second-most job cuts this year with 30,635, a 419% increase from the 5,903 cuts announced in the sector in Q1 2022.
- Health Care/Products companies and manufacturers, including hospitals, announced 22,950 cuts in the first quarter of 2023, up 65% from the 13,923 cuts announced in the same period last year.
- Retail announced the fourth-most cuts in 2023 with 21,426, a 1,125% increase from the 1,617 cuts announced in the sector through March 2022.
- The Media industry shed 582 cuts last month for a total of 10,320. Of those, 1,438 were in digital, broadcast, and print News.
Reasons for announced job cuts
- The top reason for job cuts so far this year is Market/Economic Conditions with 167,575.
- Another 24,825 were attributed to Cost-Cutting,
- 22,109 were due to store, unit, or department Closings.
- Financial Loss was the cause of 9,870 and 8,500 jobs were lost due to Restructuring.
- Demand Downturn was to blame for 7,944 job cuts this year.
Hiring Plans
- Hiring plans fell to 9,044, the lowest total for March since 2015, when 6,412 new hires were announced.
- So far this year, US-employers announced plans to hire 70,638, the lowest Q1 total since 2016, when 26,898 new hires were recorded.
- The most announcements occurred in Entertainment/Leisure with 17,317, down 53% from the 36,932 announced in Q1 last year.
- Technology follows with 9,323, down 68% from the 28,701 announced hires in the same period last year.
Source: Challenger, Gray & Christmas
From The TradersCommunity News Desk