As Americans were preparing to elect a new president, job cut announcements by U-.S.-based employers fell to the second lowest level of the year.
Outplacement consultancy Challenger, Gray & Christmas reports employers said they planned to reduce their workforces by 30,740 payroll positions in October -- down 31% from the month before and 39% lower than a year ago.
In addition to being the second lowest of the year, the October total was the lowest for that month since 1999.
“One might be inclined to speculate that the impending election might be causing employers to hold off on major workforce decisions,” said John A. Challenger, chief executive officer of Challenger, Gray & Christmas. “However, we did not see similar declines in other election years. Of course, October 2008 marked the start of the Great Recession, with job cuts soaring to nearly 113,000. This low monthly total is most likely due to the fact the economy is relatively healthy and that most employers don’t see those conditions changing in the next three to six months.”
A better economy
The strengthening economy has kept terminations down this year. To date, employers have announced 466,352 job cuts, 14% fewer than through the first ten months of 2015.
“Over the last few years, since the end of the Great Recession, the final two months of the year have seen some of the lowest job cut totals of the year,” said Challenger. “That was not always the case. From the late 1990s up until the latest recession, the fourth quarter was typically the heaviest in terms of job cuts.”
In fact, from 1998 through 2008, December job cuts averaged about 101,000. Over the last five years, they've averaged just 32,245. Last year, employers announced just 23,622 firings in December -- which was the lowest monthly total since 2000.
Tough month for computers
For the second time in three months, employers in the computer industry saw the heaviest job cuts with 4,792. So far this year, computer firms have announced 64,511 job cuts, second only to the energy sector, where they total 103,147.
Most of the computer losses came from newly formed HP Inc., which struggled to find its footing in a rapidly changing tech sector. The firm cut another 4,000 jobs last month, adding to the 30,000 that disappeared in 2015.
“When you look at the layoff data, alongside job creation statistics,” said Challenger, “it is hard to imagine that the election will come down to the economy. However, this has been one of the most unusual elections in history, so it is impossible to say what the deciding factor will be when people step into the voting booth on Tuesday.”
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