Here’s Why the Pressure to Cut Workers Hasn’t Materialized
While economists saw evidence in ADP’s National Employment Report that the large federal spending cuts had created a “softer job market this spring,” the number of planned layoffs at U.S. businesses fell in May for the third consecutive month. Employers announced 36,398 job cuts last month, a 4.5 decrease from the 38,121 cuts made in April, according to the outplacement consultancy firm Challenger, Gray & Christmas. For Chief Executive Officer John Challenger, this decrease means the economic “pressure to cut people just isn’t there. Rather, the job market looked “very positive,” he said.
In fact, an examination of Challenger’s numbers showed little evidence that fiscal austerity in Washington was hurting job growth. However, May typically experiences the smallest number of layoffs each year.
“So far, the threat of massive job cuts related to federal spending cuts has failed to materialize,” Mr. Challenger said in a statement released Thursday. Although a full recovery is far from assured as far as government downsizing is concerned, improvements in the economy may delay or minimize the impact on the workforce, he noted.
May’s layoffs were significantly lower than the figures recorded a year ago; last May, job cuts numbered 61,887. To date, the nation’s employers have announced 219,560 planned job cuts in 2013.