Job cuts on the rise - report
The nearly 75,000 layoffs were the highest total since August, according to a consulting firm, but the cuts are still not at 2001's recession pace.
NEW YORK (CNNMoney.com) -- Job cuts increased 69% in January from the previous month, as the U.S. economy continues to struggle amid a housing and credit slump, according to a survey released Monday by a consulting firm.
Global outplacement consultancy Challenger, Gray & Christmas Inc. said planned layoffs swelled to 74,986 from 44,416 in December.
The year-over-year increase was 19% from January 2007's 62,975.
The January 2008 total represents the highest monthly job cut figure since August, when there were 79,459 layoffs.
The housing and financial sectors were hit the hardest, according to Challenger, while the retail, leisure and hospitality, and professional and technical services sectors actually saw employment gains last month.
But despite the large increase in layoffs month to month, job cuts remain well below the 2001 recession levels, which averaged 140,000 per month from March to September.
"The fact that job cuts have not reached pre-September 11 levels could be an indication that the impact of the economic slowdown on the job market may be muted," said John A. Challenger, chief executive officer of Challenger, Gray & Christmas, in a statement.
Challenger believes that if the government's proposed economic stimulus package works, the United States will avoid reaching the 2001 levels.
However, if the economy falls into an all-out recession, Challenger thinks that the retail, consumer products and transportation sectors will witness job cuts, especially if consumer spending plummets.
Other sectors at risk of job cuts are the pharmaceutical industry, as existing patents begin to expire, and the automotive industry, which continues to struggle with U.S. sales, according to Challenger.