Thursday AM March 4th, 2010
by: Ed Mayberry, March 3, 2010 11:03:00 pm
The February job cuts were 77 percent lower than cuts announced in the same month last year, according to John Challenger.
"Well, certainly there's no longer any lifetime employment. There's always going to be job cuts, but to see them drop to 42,090, which is what they did in the month of February, is good news. They were down 41 per cent from January, and in fact they were way down from February a year ago when over 186,000 cuts were announced. Companies make these plans to cut jobs, so they're a good indicator of where the economy's going. They're different than kind of the rear view mirror statistics we often see about unemployment."
Recent cuts indicate that companies are getting into position to take advantage of future growth opportunities.
"Most economists agree that the recovery is well underway. These job cuts would suggest that as well. Employers have shifted away from downsizing and are poised to start adding workers. These companies, you know, that are doing these cuts right now seem to be doing them not like we saw last year in 2009—just trying to keep their company afloat, cutting costs at every corner—now these are more strategic cuts. You know, they acquire a company in that merger and acquisition, (and) there's job cuts."
Downsizing peaked in January 2009, but monthly job cuts have steadily declined since then, with just a couple exceptions. Challenger says it may still be a couple more months before hiring begins to surge.