Companies made the most job cuts in a year in January when they let go of the most people. There are a few different reasons why companies choose to let go of so many people.
According to a report provided by Challenger, Gray & Christmas on Thursday, 82,307 jobs were set to be cut in January. This was down 20% from January 2023 (the same time last year), but it was up 136% from December of last year.
A lot of companies have laid off workers since the beginning of the year. Many of them are in the tech and finance industries. Companies like Microsoft, Alphabet, and PayPal have said they’ll be letting go of many employees or cutting parts of their staff.
Senior Vice President of the company Andrew Challenger said, “After a quiet fourth quarter, waves of layoff announcements hit US-based companies in January.” “Driven by broader economic trends and a strategic shift toward increased automation and AI adoption in various sectors,” he also said about the layoffs that followed. Additionally, he mentioned that lots of businesses were laying off workers to lower their costs and produce less.
Of the total number of cuts, 23,238 were in the financial business and 15,806 were in the tech sector. Finally, 6,656 people lost their jobs as food makers.
According to Challenger, these companies are letting go of so many workers because of a few things: “High costs and improving automation technology are changing the food production industry.” Changes in the climate and immigration policies are also affecting the workforce and making things harder in this field.
ADP says their private payrolls went up by 107,000 last month, and they expect their nonfarm payrolls to go up by 185,000. It was 9,000 more than the week before, but there were 224,000 jobless claims during the week of January 27.
