Job Cuts Top 100,000 in January - Report

Reuters ^ | Tuesday February 3, 2004

[Walkin Man]

Job Cuts Top 100,000 in January - Report Tuesday February 3, 12:50 pm ET

NEW YORK (Reuters) - Planned job cuts in January were 26 percent higher than in December as U.S. jobs moved to countries like India, China and the Philippines, and as mergers made some jobs redundant, according to a report on Tuesday.

The outplacement firm Challenger, Gray & Christmas Inc., said post-holiday job cuts reached 117,556 in January surpassing the 100,000 threshold for the first time since last October.

Financial markets were on their toes awaiting January's payrolls report to be issued by the Labor Department on Friday after a disappointing December report that showed an increase of only 1,000 jobs.

Analysts had expected 150,000 new jobs to show up in the data, and the worse-than-expected outcome showed that the U.S. economic recovery has yet to produce sustained jobs growth. Economists again expect a figure of 150,000 new jobs in January.

Poor job creation is a headache for President Bush as he seeks re-election in November. The economy -- specifically job creation -- is expected to be a key issue in the campaign. Since Bush took office, more than 2.3 million non-farm jobs have been lost.

According to Challenger, consumer product companies led the January cutbacks with 22,775 job cuts, the largest number of reported job cuts in that sector in a single month since 1993, according to Challenger.

Challenger said one of the main factors for the job cuts in January was an increase of employers eliminating jobs in the United States and shifting to service providers in India, China and the Philippines among other countries.

Another factor was an increase in mergers so far this year. The survey's head, John Challenger, noted in a statement that one of those mergers will result in "as many as 10,000 job cuts to take place as redundant positions are eliminated."

[FITZ]

When we hear some person who really doesn't know the situation tell us to open a business ... as if that was a viable and immediate solution to our plight ... it is insulting.

Where do they suggest you get the money to start a business? Some businesses take a lot of money to start --- you have to get a building, expensive equipment, health insurance? When someone loses a job, money gets pretty tight --- what savings they have might need to go toward future mortgage payments, electricity bills and groceries. Who has the thousands laying around that it often takes --- depending on the business?

[RaceBannon]

Someone suggested I start a business washing windows at the local colleges, the outsides.

I wonder, it might work, minimal payout for material, soap and water and a squeegie and rags, and a pole for the tall window squeegie

With my bad shoulder, I am contemplating buying a fishing boat. That or more college. I honestly dont know which is the bigger threat to success.

[FITZ]

Also if someone gets laid off and then spents 9 months collecting unemployment checks and waiting for a job to open up in the exact same industry as their previous job, pretending that they CAN'T POSSIBLY work in any other industry than the one they were just working in, rather than going down to McDonald's or Walmart or the local frozen yogurt shop or wherever to look for a job, or offering to tutor or do some other informal/part-time work, that's a sign of how desperate

Do you or have you ever had kids and a mortgage??? It would be insane for me to give up unemployment checks if I lost my jobs and go work at a McDonalds for $5.15 an hour. I'd lose my house, there's no way I could support a family on that kind of money, the time I'd be wasting at McDonalds would be better spent looking for job equivalent more or less to the ones I have now. I'd have to work at least 3 full-time McDonald jobs ---- that would leave no time for sleeping much less spending time with family or looking for a job I could live on.

[KC_Conspirator]

I am still waiting for India to create something.

[FITZ]

Did I miss anything?

I think you did --- the Constitution says something about the government's purpose being "to promote the general welfare" --- I take that to be the general well-being of the American citizens. No where in the Constitution are corporations mentioned, we are supposed to have a government for the people --- not only for the corporations looking for the lowest possible wages so a few aristocrats get extremely wealthy.

[dark_lord]

Also if someone gets laid off and then spents 9 months collecting unemployment checks and waiting for a job to open up in the exact same industry as their previous job, pretending that they CAN'T POSSIBLY work in any other industry than the one they were just working in, rather than going down to McDonald's or Walmart or the local frozen yogurt shop or wherever to look for a job, or offering to tutor or do some other informal/part-time work, that's a sign of how desperate they are rather than a sign of how comfortable we all have it that we've made a system that allows us to survive for 6 or 9 or 12 months or even longer with no job whatsoever, and so we should all feel sorry for them. And, of course, we should always, always, always remember to blame the President - I mean, Economy Czar. All good things come from big daddy President.

Great sarcasm. Overlooking the fact that someone with a mortgage and 3 kids isn't going to survive "McDonald's or Walmart or the local frozen yogurt shop". Yeah, if you're 25 and single, no sweat. Actually, if you're single, period, no sweat.

[bvw]

Big midget, eh? Well, the Founders laid out clear charter for a limited government just as you say. Yet they didn't have excesses and serf-affinties like the income tax, with-holding and a hyperactive commerce clause. Instead they encouraged domestic industry and production by raising most revenue via tariffs.

Today domestic industry is extremely discouraged by means of income tax and over-regulation. And foreign attacks on our domestic industry are encouraged by low or no tariffs and by "multinational" (that is foreign) buy-outs and sundry briberies of our politicians, which yield a cornucopia of off-shore loans, grants and favors galore.

[oceanview]

many of us predicted this would happen, as US companies learn to offshore, correcting mistakes with the programs and fine tuning them, that it is obvious they would be increasing them. and they are. their 2004 workforce plans are being put in place, and here we go.

a friend of mine who works in the finance/accounting department for IBM got the word this month: all their jobs are going to BRAZIL.

a very serious problem for Bush, he did not create it for sure, but its happening on his watch and his economic team doesn't even seem to be aware that it is happening.

[Ciexyz]

The more competitive the tax regime the more efficient it is to create jobs.

Yes, look at Pennsylvania - Democratic governor raised taxes, refuses to lower our already high tax rates, companies move out. Look at my hometown of Pittsburgh PA -- mayor refuses to lower taxes, instead sought and received distressed status for city -- raised more taxes, parking tax at 50% is highest in nation, businesses threatening to move out of town. The Dems just refuse to see any connection between high taxes and lost jobs!

[raloxk]

Some fact I would like to point out here:

The wage gap between the US and the rest of the world is less today than it was 30 years ago, yet firms werent moving to places like India 30 years ago.

The terms of trade were more against the US in the 30 years after WW2 than they are today, yet we had trade surpluses in that time. The terms of trade were more against the US after WW2 because the US wanted fast economic growth around the world as a tool against the spread of communism


I dont like this outsourcing but there is nothing that can be done to stop it. It is a historical fact. People here rarely offer any solution to this problem, they just rant. This huge upheavel will probably last for a few decades and will result in tremendous economic and political changes around the world.

China should be pressured to float its currency but that wont make the problem go away, it will just reduce the trade deficit with China by a few billion.


As for GATT is has been around since 1944 or 45. It was a tool to stop communism and avoid another depression. If you think free trade alone is the reason, I ask you when did we sign a free trade agreement with Vietnam or India? We didnt. China got MFN but there is no free trade agreement with China either.

I dont think there is awnyway to stop what is a historically unstoppable force.

[Jorge]

....as well as weakening potential export markets for our products.
The future in any event does not bode well for domestic manufacturing jobs unless you're willing to pay more for that car or appliance because it's made here. You may say yes but you won't act accordingly.

Most sensible post I've seen on these threads for a long time.

[Ciexyz]

I'm listening to John Dean on Fox News and he's going on about jobs: stop offshoring, stop businesses from relocating their HQ's to Bermuda, "his standard sub speech" acc to Brit Hume. This is the mantra that we'll be hearing thru the election.

[Jorge]

That is why our government can control the borders of Iraq but not the southern border of the USA!

What makes you think our government can control the borders of Iraq?

They haven't been able to so far, even with all the troops we have over there now.
Insurgencies across the borders of Syria and Iran are said to be responsible for most of the attacks on US soldiers throughout Iraq.

[FITZ]

Yeah, if you're 25 and single, no sweat. Actually, if you're single, period, no sweat.

And still living with your parents. Who can work at a McDonalds if they're paying their own mortgage or rent??? Most McDonalds jobs are only part-time --- I've heard sometimes they make you work a split shift --- work 2 hours at lunch, then go home, then work 2 hours at dinner ---- it would be pretty hard to work enough McDonalds jobs to make ends meet.

[oceanview]

if current trends continue for another 10-15 years, we will be a two tiered socio-economic society. we'll have wealthy elites with their super bowl tickets, plasma TVs, Mercedes Benz (record sales for 2003 by the way), country club memberships, et al. We'll have a middle class made up of mostly government workers and workers in "subsidaries" of government like health care, education, and law. And we'll have the working poor filling service jobs.

And when we are structured that way socio-economically, and toss in the demographics shifts we all know are happening, the Democrats will have a permanent majority at all levels of government.

[Dr. Frank fan]

It would be insane for me to give up unemployment checks if I lost my jobs and go work at a McDonalds for $5.15 an hour.

I'm a little confused, for nobody's asking you to.

The rest of your post illustrates nothing more and nothing less than that being on unemployment for an extended period of time as you look/wait for a new job at similar pay rate is actually a viable option for you and your family. That's good, not bad.

If the "McD" option suddenly became viable and appealing to you, that would be a sign of trouble.

[raloxk]

Directly immigration both illegal and legal and offshoring have nothing to do with one another, however they are both the result of global economic upheaval that is going on, so indirectly they are related because they are caused by the same thing.

This is occuring because the world is transitioning from one paridigm to another. I dont like it and I long for the world of the 1980s, but I really see this as a historical event beyond anyones control, similar perhaps to the industrial revolution.

[oceanview]

and how many more reports like this will they have to see before they acknowledge what is happening.

let see what friday's job reports looks like, they expected 150K in December and got 1K. they expect 150K in January, we ought to start a pool to see who can guess closest to the actual figure.

[Dr. Frank fan]

I think you did --- the Constitution says something about the government's purpose being "to promote the general welfare" --- I take that to be the general well-being of the American citizens.

I didn't "miss" that. But there are ways in which the government can "promote the general welfare" and they are listed in the Constitution. Similarly, there are duties/powers of the President and they are listed in the Constitution. "Creating jobs", even if he could really do it, simply ain't one of them

No where in the Constitution are corporations mentioned,

That's true. Who said they were.

we are supposed to have a government for the people --- not only for the corporations looking for the lowest possible wages so a few aristocrats get extremely wealthy.

Uh huh. And so, your point is that Bush should do.... ?

[oceanview]

do you realize how low the dollar would have to go to make wages comparable? its impossible for it to go that low, absent a total economic calamity.