Challenger Report December 2009

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Challenger Report

Challenger, Gray & Christmas reported relatively good news on the job front this morning. Challenger's Job-Cuts Report showed announced corporate layoffs were the lowest in two full years. Job cuts were down 73% from this time last year alone. Only 45,094 employees were slated for layoff in December, down from the 50,349 reported in November 2009.

The great year for the stock market was far from noteworthy for labor positives. Through 2009, American businesses announced plans to consolidate (read "fire") 1,288,030 jobs. Last year marked the worst period for such declared life destruction since 2002, the last time a bubble burst in America. Despite the improvement in December, in comparison to 2008, the full year atmosphere was similarly dismal; the full year 2009 was only 5% worse than 2008. Still, some 70% of the total year's layoffs came in the first half.

The depth of this Great Recession is no secret, but the market is focused now on the direction of job trends, and the trend is illustrating improvement (almost). We can at least say deterioration is occurring at a significantly slower pace. For those of you who like to see the glass half full, fourth quarter job cuts dipped to the lowest point in nine years. In fact, Q4's 151,121 announced firings represented a 67% decline from Q4 2008. All in all, it was the best quarter since 2000.

Debbie Downer reminds us though, that most layoffs are not announced via public press release. Through October of 2009, the federal government counted 23.5 million corporate layoffs, which contrasts sharply against Challenger's tally of 1.29 million. Whap Whomp...


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Editor's Note: This article should interest investors in Robert Half International (NYSE: RHI), Korn Ferry (NYSE: KFY), Manpower (NYSE: MAN), Monster World Wide (NYSE: MWW), General Employment Enterprises (NYSE: JOB), Global Employment Holdings (OTC: GEYH.PK), Career Education (Nasdaq: CECO) and 51job Inc. (Nasdaq: JOBS).