Retail Jobs Mark The Second Highest Number Of Cuts In Q1
By Christine Kern, contributing writer
Cuts spiked 41 percent in the retail sector.
Even as the U.S. Department of Labor released its most optimistic employment report to date, retail job cuts reached the second highest number of job cuts recorded in Quarter 1, 2016, led only by the energy sector, according to outplacement firm Challenger Gray and Christmas’s monthly and quarterly report. The retail sector marked 41 percent reduction in staffing, or 31, 832 jobs in Q1, up from 22,502 in Q1, 2015.
The report found that employers announced 184,920 job cuts during the first quarter of 2016, a 31.8 percent increase over the 140,241 cuts in the same period last year and 75.9 percent more than in Q4 2015’s 105,079 job cuts.
“Job cuts have slowed since surging in the first two months of the year, but the pace is still well above that of 2015. And, it is not just the energy sector that is seeing heavier job cuts. Layoff announcement have increased significantly in the retail sector and computer sector, as well. While it may be too early to sound the alarm bells, the upward trend outside of the energy sector is somewhat worrisome,” said John Challenger, chief executive officer of Challenger, Gray & Christmas.
The U.S. Department of Labor meanwhile has reported that the proportion of Americans employed is at its highest level in two years, up somewhat to 63 percent as the economy added 215,000 jobs in March. The unemployment rate rose to 5 percent, compared with 4.9 percent last month, as more Americans are now job seeking.
Challenger’s report indicates that the American economy is on more tenuous ground than the Labor report suggests, with retail jobs losses reaching 8,490 in March, a significant increase from the 1,096 reported in February, and also more than the 6,640 retail job cuts seen last March. Macy’s, Nordstrom’s, Bebe, and Avon are among the major retailers making Q1 job cuts.
Challenger explains that this is a reflection of how technology is transforming business across sectors, including retail. He stated, “We, as a nation, and really as a global community, are changing the way we buy goods and services. Technology is in a constant state of change, and, currently, we are shifting away from computing at our desks to computing on our phones and tablets.”
“These changes are necessary and inevitable, but they come with a cost in the form of job loss. However, while jobs are being lost in some areas, they are being created in others, including renewable energy, online retailing, and mobile computing,” Challenger concluded.