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Layoff, hiring plans both gain
Challenger survey: Employers announced plans for 108K layoffs and almost 42K hires in February.
March 2, 2005: 2:07 PM EST

NEW YORK (CNN/Money) - Layoff announcements bounced back above the 100,000 mark in February, according to a survey by job outplacement firm Challenger, Gray & Christmas, but hiring plans also accelerated.

The monthly survey showed 108,387 job cuts announced during the month. That's up 17 percent from January levels and up 43 percent compared to February of 2004.

But employers also announced plans in February to hire 41,984 employees. That's up 41 percent from January's hiring announcements and it marked the fifth consecutive month of increased hiring plans.

Firm CEO John Challenger said the pickup in both hiring and layoff plans is not that unique, and is a sign of economic growth overall.

"In a situation where the economy is gaining traction and companies are preparing for expansion, there is a unique labor market environment where both job creation and job destruction occur simultaneously," he said. "Improving economic conditions have made mergers and acquisitions far more desirable and companies are in a better position to gobble up competitors or other companies that will expand their product offerings. However, a typical byproduct of these deals is...job cuts."

A number of big corporate couplings already announced in 2005 have been a major driver of job cut announcements. Challenger's survey says that mergers and acquisitions are responsible for plans to lay off 64,343 employees so far this year, or just less than one in three job cuts announced the first two months. That total almost equals the merger-related job cuts announced in all of 2004.

The survey report comes ahead of Friday's closely watched February employment report from the Labor Department. Economists surveyed by forecast that February saw a net gain of 225,000 in U.S. payrolls during the month, up from the 146,000 job gain in January.

The unemployment rate is forecast to remain at 5.2 percent.

Click here for more on the jobs outlook.  Top of page


Layoffs and Downsizing
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