Planned layoffs at U.S. firms fell for a third straight month in October to a 19-month low, feeding hopes the labor market will continue to improve as economic activity rebounds.
Planned job cuts announced by U.S. employers fell to 55,679 in October, down 16 percent from 66,404 in September, according to a report released on Wednesday by global outplacement consultancy Challenger, Gray & Christmas, Inc.
The October job cuts were the lowest since March 2008, when employers said they would shed 53,579 workers, and the October numbers are 51 percent below the year-ago announced layoffs.
For the year through October, announced job cuts are up 36 percent from the prior-year period, at 1.19 million. The total announced layoffs this year are just 31,406 shy of last year's total of 1.22 million.
John Challenger, chief executive of Challenger, Gray, cautioned that the employment market recovery will not be as swift as its fall.
Companies will, at first, be very cautious not to over-hire, in case this recovery is not sustainable. Even when the pace of job creation accelerates, it simply will take a lot of time to reabsorb all of these displaced workers, he said in a statement.
Planned layoffs in October were driven by the automobile industry, with 13,420 announced layoffs. The sector, with a total of 164,440 planned layoffs this year, may see more downsizing in 2009, the report said.
Government and non-profit entities rank second in year-to-date payroll reductions, with announced layoffs of 160,434 workers. The sector is poised for more cuts as many state and local governments grapple with hefty budget deficits.
(Reporting by Camille Drummond; Editing by Leslie Adler)