Layoffs have unfortunately become a stark reality in today's workplaces, affecting not just companies but also leaders and numerous employees. August saw a significant surge in layoff announcements as businesses intensified their efforts to reduce costs, revealed a research conducted by Challenger, Gray and Christmas, a firm specialising in outplacement and executive coaching.
According to a study published on Thursday, US-based employers disclosed plans to cut 75,151 jobs in August. This represented a striking increase of 217% compared to July and a staggering 267% surge when compared to August 2022.
Challenger highlighted that in the year-to-date, companies shrink their workforces by a total of 557,057 positions. This marks a substantial 210% escalation compared to the corresponding period in 2022 and represents the highest number of job cuts within this timeframe since the initial pandemic year of 2020.
Andrew Challenger, the Senior Vice President of Challenger, Gray & Christmas, explained that the uptick in job cuts should not come as a surprise. He attributed this trend to technological advancements causing disruption in the job market and businesses adopting cost-saving strategies in response to economic conditions.
He said the labour market “is resetting after the pandemic and post-pandemic hiring frenzy,” and the job openings are declining, and workers are more reluctant to quit now.
Among the 30 sectors examined, the consulting firm reported that only five of them—automotive, government, entertainment/leisure, industrial goods, and utilities—have not experienced any layoffs so far this year.
During the month of August, the warehousing industry recorded the highest number of job cuts, totalling 32,123, primarily due to the bankruptcy of Yellow Corp. Following closely behind were the healthcare/products sector with a reduction of 7,688 positions, retail with 6,262 job cuts, and telecommunications with 5,273 layoffs.
The technology sector, which had been consistently leading in layoff announcements for several months, saw a decline with 3,198 job reductions in August. This marked the lowest number of layoffs in the sector since June 2022.