Planned Job Cuts Rise Over Last Year

Chicago, IL, Oct. 5, 2011 -- Planned job cuts jumped 212% in September compared to a year ago, the largest increase since January 2009, according to outplacement firm Challenger, Gray & Christmas.

Planned cuts rose to 115,730 last month from 37,151 in September 2010, led by planned cuts in government employment and at Bank of America.

While the bulk of firings are not “directly related” to economic weakness, they “could definitely be a sign of more cuts to come,” John A. Challenger, chief executive officer of Challenger, Gray & Christmas, said in a press release.

“Bank of America is not the only bank still struggling in the wake of the housing collapse, and the military cutbacks are probably just the tip of the iceberg when it comes to federal spending cuts.”

Compared with August, job-cut announcements climbed 126%, the Challenger report showed. Because the figures aren’t adjusted for seasonal effects, economists prefer to focus on year-over-year changes rather than monthly numbers.

Government agencies announced 54,182 reductions in September. Of those, 50,000 resulted from the troop reductions announced by the Army, Challenger said.