Taps Coogan – December 5th, 2022

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The Challenger, Gray, & Christmas job cuts index has shown a sharp increase in the pace of layoffs in November, as the following chart from Christophe Barraud highlights. The chart shows the year-over-year rate of change in the index, which spiked to 417%.

Layoffs in 2022 have been historically low but the 127% month-over-month and 417% year-over-year rise in November represents the quickest increase since the original Covid lockdowns. The biggest jump in layoffs was concentrated in Tech which announced nearly 81,000 cuts.

This index does not look at hires and is thus not a ‘net’ number. The Labor Department’s November jobs report, which is a ‘net’ number, was relatively strong. Nonetheless, the job cuts number is likely the more ‘leading’ indicator and a warning to not over-estimate the durability of the labor markets.

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