Mass layoffs highest since 9/11

Government report says job cuts of 50 or more up significantly last month.

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By Emily Maltby, staff writer

NEW YORK ( -- The number of layoff announcements involving at least 50 workers rose in September to the highest level since the Sept. 11 terrorist attacks seven years ago, the government said Wednesday.

There were 2,269 mass layoff actions, up 497 from August, according to statistics released by the Labor Department. That was the most mass layoffs since the 2,407 in September 2001.

"At large firms, basically what I see is an across-the-board, shotgun approach," said Paul Sarvadi, chairman and CEO of human resources outsourcing firm Administaff in Houston. "If they anticipate revenues going down, then they see how much they need to cut to reach operating targets, and equate that cost to a number of people."

Overall, the number of initial claims for unemployment benefits related to mass layoffs rose by 61,726 to 235,681. That was the highest level since September 2005, after Hurricane Katrina devastated the Gulf Coast, resulting in 297,544 claims.

The manufacturing industry pulled the most devastating numbers, accounting for 28% of all mass layoffs and 36% of unemployment insurance claims in September. More specifically, 19,278 of the 46,391 claims in that industry came from the transportation equipment sector.

"Most manufacturers are pretty secure," said Chris Kuehl, economic analyst for the Fabricators and Manufacturers Association. "But there's been a lot of action in the auto and aerospace sectors, such as the Boeing strikes and the low demand for cars due to the credit crunch."

Kuehl believes that layoffs at auto and aerospace companies, a large segment of the manufacturing industry, don't tell the whole story. "After all, the medical manufacturing and energy segments are gangbusters," he said.

But the overall situation is grim, and the worst may not be over, according to some experts.

Sue Murphy, manager for National Human Resources Association in Nashua, N.H., believes that there will be an increase in layoffs as the practice of scrutinizing employee count continues.

She said companies will accelerate the trend of cutting hours, replacing jobs with technology and outsourcing labor during tough times like these, when their priorities are protecting costs and market share.

"The companies look at the nice-to-haves and the must-haves, and the employees that are not essential will be up for review," Murphy said. "A lot of quality people will be out of work." To top of page

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