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Job-cut announcements drop
Number of cuts announced by U.S. firms retreats from October's 12-month peak, report says.
December 2, 2003: 1:36 PM EST

NEW YORK (CNN/Money) - U.S. job-cut announcements fell in November from their highest level in a year, according to a report Tuesday by an outplacement firm that keeps track of job cuts.

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U.S. businesses announced 99,452 job cuts in November, compared with 171,874 in October, according to Chicago-based Challenger, Gray & Christmas. October's level of job-cut announcements had been the highest since October 2002.

"Job-cut announcements have been on a roller coaster ride this year," said the firm's CEO, John Challenger. "The lack of any discernible trend in corporate downsizing is indicative of the uncertainty associated with the current economy."

Telecommunications industries led the job cutting in November, announcing 19,183 cuts, according to Challenger. Electronics firms announced 9,794 cuts, consumer products firms announced 9,518 cuts and industrial goods firms announced 8,258.

So far in 2003, firms have announced 1.14 million job cuts, 17 percent less than the 1.37 million announced in the first 11 months of 2002, Challenger said.

Though unemployment is typically a lagging economic indicator, the U.S. economy has enjoyed eight straight quarters of economic growth, including a growth rate of 8.2 percent in the third quarter of 2003, without significant job creation.

In fact, since the declared end of the latest recession, in November 2001, nearly 800,000 payroll jobs have been lost, according to the Labor Department, making this recovery period the most "jobless" since World War II.

 

But a recent decline in the number of new weekly claims for unemployment benefits, along with a surge in business spending and some consumer surveys saying jobs may be getting easier to find, have raised hopes that the economy may be close to creating enough jobs to chip away at unemployment.

The Labor Department is scheduled to release its data on November's unemployment rate and non-farm payroll changes on Friday. Economists, on average, expect payrolls to grow by 150,000 jobs and the unemployment rate to remain at 6 percent, according to Briefing.com.

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In his report, however, Challenger expressed skepticism that a job boom was on the way any time soon. The firm noted that recent advances in technology are helping businesses produce more with fewer workers, and suggested many companies will seek to fill their labor needs by outsourcing work overseas.

"Between technology and globalization, a large majority of U.S. white-collar jobs will become obsolete and either eliminated or dramatically altered," Challenger said.  Top of page




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