U.S. layoffs hit a record high in more than two years in January, according to a report released on Thursday (2nd), as technology companies cut jobs at the second-highest rate on record in response to a possible recession.
The layoffs affected 102,943 workers, more than triple from December and more than five-fold from a year ago, according to a report by employment firm Challenger, Gray & Christmas Inc.
Last month, companies including Microsoft (MSFT-US), Amazon (AMZN-US) and Goldman Sachs Group (GS-US) cut thousands of jobs in an effort to survive a time when high inflation and rising interest rates have curtailed consumer and business spending. period of low demand.
“We’re in the extreme opposite of the pandemic-era hiring frenzy right now,” said Challinger, a labor expert and senior vice president at the employment firm. “Companies are bracing for a slowdown, layoffs and slower hiring.”
Efforts to correct overhiring during the pandemic were most pronounced in the technology sector, which shed 41,829 jobs last month, the most of any industry.
Second only to technology were retailers, which shed 13,000 jobs in January, up from almost none a year ago. Meanwhile, financial firms cut 10,603 jobs last month, up from 696 a year earlier.
With the Fed expected to continue on its path of rate hikes to curb inflation, which remain elevated after several rounds of hikes, analysts said U.S. companies could cut more jobs.
“For companies that have increased headcount over the past few years, they may shrink headcount as the economy heads toward tougher times,” said OANDA analyst Edward Moya.
