US: Challenger Job-Cut Report

Thu Feb 01 06:30:00 CST 2018

Actual Previous
Announced Layoffs - Level 44,653 32,423

Retail payrolls turned lower all last year and are starting off 2018 on another down note, rising more than 15,000 to inflate Challenger's January layoff count to 44,653. But January is often a heavy month for retail layoffs as it was last January at more than 22,000.

Challenger is one of the few reports that doesn't offer seasonal adjustments, adjustments that account for monthly idiosyncrasies and smooth out the data. Looking at the year-on-year comparison, not the monthly, helps to minimize the effects of monthly quirks and this comparison is actually favorable for today's report as last January total layoffs were even larger, at 45,934.

Due to the adjustment issue, this report is too clouded to be of much help in forecasting Friday's employment report for January. Watch later this morning at 8:30 a.m. ET for weekly jobless claims.

This monthly report counts and categorizes announcements of corporate layoffs based on mass layoff data from state departments of labor. The job-cut report must be analyzed with caution. It doesn't distinguish between layoffs scheduled for the short-term or the long term, or whether job cuts are handled through attrition or actual layoffs. Also, the job-cut report does not include jobs eliminated in small batches over a longer time period. Unlike most economic data, this series is not adjusted for seasonal variation.

The job-cut report is basically a rehash of the weekly jobless claims report but provides additional insight into where layoffs are occurring. There is industry and geographic (states) detail that is not available with weekly jobless claims.