Job cuts in October see a significant increase from the previous year, accompanied by a decrease in job openings and stagnant hiring numbers.

October 31, 2024 TruthUSA

Recruitment expert Andrew Challenger states that job openings have decreased, and hiring is currently stagnant.

In October, U.S. layoff announcements rose compared to the previous year, indicating a gradual cooling of the labor market post-pandemic.

According to data from the global recruitment firm Challenger, Gray, and Christmas, companies reported 55,597 layoffs last month, a decrease of 24 percent from September but an increase of 51 percent from the previous year.

The aerospace and defense industry led in layoffs, with 18,465 cuts, mainly due to Boeing’s decision to eliminate 17,000 positions.

“Significant cuts from major companies can lead to further job losses among suppliers and customers,” stated Andrew Challenger from Challenger, Gray, and Christmas.

Retail and consumer products industries also saw substantial layoffs in October.

For the year, technology had the most job cuts at 120,470.

The labor market has seen higher job cut announcements for seven consecutive months, with businesses announcing 664,839 layoffs in the first ten months of the year, a 4 percent increase from the same period in the previous year.

Cost-cutting has been the primary reason for layoffs, with closures and market conditions also contributing to the reduction in headcount.

Hiring plans have been modest in 2024, with Amazon accounting for the majority of the announced job openings in October.

Employers planned to hire over 750,000 workers in the first ten months of the year, the lowest total since 2016.

Andrew Challenger mentioned, “Job openings are declining, and hiring is relatively stagnant at the moment, as companies await election outcomes and potential regulatory changes.”

Snapshot of the US Labor Market

This week, the focus will be on the October jobs report, providing a crucial insight into the U.S. labor market ahead of the presidential election.

Leading up to the election, the labor market has been exhibiting mixed signals.

John Butters from FactSet states that median estimates for employment gains and the unemployment rate are 117,500 and 4.1 percent, respectively, in October.

A hiring sign is displayed in the window of a Chipotle in Alexandria, Virginia, on Aug. 22, 2024. (Anna Rose Layden/Getty Images) — A hiring sign is displayed in the window of a Chipotle in Alexandria, Virginia, on Aug. 22, 2024. Anna Rose Layden/Getty Images

The White House anticipates a possible impact on October jobs data due to ongoing labor actions.

Jared Bernstein, from the Council of Economic Advisers, stated, “We expect payrolls to be impacted by strikes, as the Bureau of Labor Statistics indicated that around 41,000 workers might not be counted in the October payroll report.

The ongoing strike by Boeing factory workers and the rejection of a contract offer by the machinists and aerospace workers could further impact the economic data.

Economists have cautioned that upcoming economic statistics might be distorted by recent hurricanes and labor disputes.

While early October saw an increase in individuals filing for unemployment benefits, subsequent weeks have witnessed a decline in jobless claims.

For the week ending October 26, initial jobless claims dropped to 216,000, the lowest since May, as reported by the Department of Labor.

Continuing jobless claims decreased to 1.862 million, and the four-week moving average also declined, indicating a stabilization in jobless claims.

The labor market has seen a decrease in worker turnover and hiring efforts by businesses.

In September, job vacancies dropped below 8 million, the lowest since January 2021. Additionally, the number of people voluntarily leaving their jobs reached the lowest levels since August 2020.

A report by RedBalloon’s Freedom Economy Index revealed that the majority of small businesses are neither hiring nor firing staff, indicating a stable but subdued labor market.

The economy remains a key concern for voters, and the role of the labor market in the upcoming presidential election remains uncertain.

Recent surveys show optimism among Americans regarding national employment conditions.

The Consumer Confidence Index by The Conference Board indicated an increase in consumer confidence in October, particularly in views on current job availability.

Mark Malek, CIO of Siebert Financial, observes a loosening in labor conditions, but believes the market remains resilient even though weaker than a year ago.

Judith Raneri, from Gabelli Funds, suggests that while the U.S. economy remains robust, signs of slowing growth are starting to emerge, with slower job gains seen in recent data.

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