Challenger Job Cut Report: Employers handout fewer pink slips ahead of Christmas

Some U.S. workers are getting an early Christmas present as the increasing number of job cuts since the summer saw a drastic slowdown in November according to a report released Thursday by global outplacement consultants Challenger, Gray & Christmas, Inc.

After a four-month stretch that saw more than a quarter of a million job cuts announced by U.S.-based firms, planned layoffs in November fell to the lowest level in more than a year.

According to Challenger, the nation’s employers announced workforce reductions totaling 30,953 in November, 39% fewer than the 50,504 planned job cuts in October. Last month’s layoff total was 14% lower than November 2014, when 35,940 job cuts were reported.

November represents the smallest job-cut month since 30,477 planned cuts were announced in September 2014. The 14-month low comes on the heels of a four-month period during which 256,263 job cuts were recorded.

Still, Challenger officials say the November reprieve may be temporary until after the holidays.

“The fourth quarter tends to experience heavier cuts, as employers make year-end adjustments to workforce levels in order achieve earnings goals,” said John A. Challenger, CEO of Chicago-based outplacement firm. “The November decline could be the quiet before a December storm or it could signal a lower-than-expected downsizing to close out the year.”

If recent history is any indication, it could be the latter, Challenger said, as December job cuts have been lower than the annual average since the end of the 2008 recession.

To date, employers have announced 574,888 job cuts in 2015. That is 28% more than the 450,531 job cuts announced through November 2014. With just one month remaining in the year, job cuts are on pace to be the heaviest since 2009, when 1,272,030 layoffs were tabulated.

While oil-related job cuts have dominated the headlines in 2015, they accounted for just 1,355 in November, the fewest since June (278).

Industrial goods ranked as the top job-cutting industry last month, with firms in the sector announcing 7,398 planned layoffs. That is up 109% from the 3,390 job cuts announced in this sector in October.

Industrial goods firms have announced 54,845 job cuts so far this year. That ranks fourth behind energy (92,727), government (70,029), and retail (65,609).

In 2008, employers announced 166,348 job cuts in December, the second highest job-cut month of that year. However, beginning in 2009, December job cuts have averaged just 35,784.

“Overall, the US economy is fairly strong. The increase in job cuts this year is due to a handful of industries,” Challenger said. “In fact, of the 28 sectors we track, more than half have experienced a year-over-year decline in job cuts. Unfortunately, five sectors have seen job cuts more than double. Job cuts in the energy sector have increased a staggering 708% from a year ago.”