Unemployment is still low, but are private sector layoffs accelerating?
Unemployment is still low, but are private sector layoffs accelerating?
Initial claims for unemployment benefits have held pretty steady in recent months and remain low by historical standards. But that doesn’t mean layoffs aren’t happening — and possibly accelerating — across the economy.
Over the last two months, job cuts of 1,000 workers or more have been announced by companies including Chevron, Meta, Starbucks, Southwest Airlines and more. This comes on top of mass layoffs of federal workers — possibly in the hundreds of thousands — being pursued by the Trump Administration.
Overall, the job market is still pretty strong. But Andy Challenger at outplacement firm Challenger, Gray & Christmas is bracing for worse to come.
“We expect a lot more job cuts,” he said. “Because of conversations I’m having with companies, I’m hiring like crazy.”
It’s sad but true: The firm’s busier when a lot of newly laid-off workers need help finding jobs.
Challenger said the tech and housing sectors have been gradually downsizing. But now, “I’m starting to see a much wider array of industries beginning job cuts, companies revise downward their growth outlooks, [are] getting leaner, getting more cost-effective.”
Americans are getting more pessimistic, according to Stephanie Guichard at The Conference Board, with fewer people saying it’ll be easy to find a job in the future.
Yet “we don’t see people being worried about losing their jobs,” Guichard said. “Sentiment about future income is still positive.”
And “even though there are lots of layoffs in the news also from the public sector in a way that we haven’t really ever seen, I wouldn’t be too depressed or dismayed about the job market,” added Andy Challenger.
After all, the unemployment rate is still at a very low 4%.
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