By Maria Armental
Job cuts in May rose to the highest level in more than a year,
with the technology sector being hardest hit, according to
outplacement firm Challenger, Gray & Christmas.
U.S.-based employers said they intended to cut 52,961 jobs, a
31% increase from April and the largest one-month total since
February 2013, when 55,356 job cuts were recorded, according to
figures compiled by the outplacement firm.
Hardest hit was the technology sector, Challenger said, noting
it had recorded 18,799 announced job cuts in the sector, the
highest number since May 2012. Most of those cuts--as many as
16,000--come from Hewlett-Packard Co. (HPQ), which also accounted
for the largest share of the cuts in 2012.
"Five-figure job-cut announcements, such as Hewlett-Packard's
last month, have been rare since the recession ended in 2009," John
A. Challenger, the firm's chief executive, said in a statement,
noting, "The last time we saw a figure on this scale was February
2013, when JP Morgan Chase announced a large reduction in the
number of bankers in its mortgage unit, most of whom were hired in
the wake of the recession to deal with the flood of foreclosures
and the refinancing of troubled loans."
On an annual basis, the computer or tech sector has lost the
most jobs to date, followed by retail, financial,
healthcare/products and transportation.
Geographically, most job cuts were reported in California,
followed by New York, Florida, Illinois and Pennsylvania. The
geographic location, however, is based on the location of the
layoff or corporate headquarters identified in the company's
announcement.
Despite the May surge, Mr. Challenger said, the downsizing pace
is expected to continue to slow down in the second half of the year
"unless there is a sudden and severe shock to the economy."
Mr. Challenger pointed to reports of continued growth in the
coming months, strong car sales, factory orders increasing in April
for the third consecutive month, and a report that small businesses
saw their strongest hiring push in more than a year as promising
signs.
"Moreover, the latest report on metropolitan area unemployment
from the Bureau of Labor Statistics shows that there are now 118
metro areas with unemployment rates below 5.0%," Mr. Challenger
said. "All of this bodes well for the nation's job seekers."
Write to Maria Armental at maria.armental@wsj.com
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