The number of planned layoffs at U.S. firms fell in February to the lowest level since 2006, and employers appear to have shifted away from downsizing even though hiring may be a while off, a report on Wednesday showed.
Employers announced 42,090 planned job cuts last month, the lowest level of monthly job cuts since 37,178 were announced in July 2006, according to the report from global outplacement consultancy Challenger, Gray & Christmas, Inc.
There is an overall sense that we have turned the corner. With downsizing showing dramatic signs of stabilization, chances are good that increased job creation is approaching, said John Challenger, chief executive officer of Challenger, Gray & Christmas.
The February total was 41 percent lower than the 71,482 job cuts announced in January, and 77 percent lower than the 186,350 job cuts announced in February 2009.
Monthly job cuts have mostly been on the decline since the 241,749 cuts in January 2009, which marked the peak of downsizing activity in this recession.
It may be a couple of more months before hiring begins to surge, but it is clear that employers have shifted away from downsizing and are poised to start adding workers, Challenger said.
One of the largest planned job cuts announced last month came from Merck & Co.
We expect to see more cuts from mergers and acquisitions or from companies shifting focus from one business area to another, Challenger said.
(Reporting by Caroline Valetkevitch, Editing by Chizu Nomiyama)