The Challenger report on job cut announcements is little changed in May from April, down 1.5 percent to 63,816 from 64,789 in the prior month. Announcements are down 20.3 percent from 80,080 in May 2023. For the first five months of 2024, announcements total 385,859, a little below the level of 417,500 for the same period last year, but significantly higher than 100,694 in 2022. The present underlying trend for layoff activity does not seem to be worsening, but neither is it improving.

Job cut announcements are broad-based and do not seem to signal particular distress in any one industry. The largest share of layoffs by industry is 9,180 in entertainment/leisure (14.4 percent of the total), followed by 7,771 cuts in technology (12.2 percent), and 7,400 in utilities (11.6 percent).

By reason cited for job cuts, the largest share is 15,785 in closing (24.7 percent) and 10,671 in market/economic conditions (16.7 percent). Challenger said,"Employers across the board are citing vague reasons for cutting jobs, but we know artificial intelligence and the disruption that follows is the cause, at least in part, for many companies' plans. The disruption is impossible to refute. That said, other economic factors are also at play in many of these announcements." Cuts in technology remain the largest source of layoff plans in 2024 at 55,207 year-to-date, although this is far less than 136,831 in the first five months of 2023.

Challenger, Gray & Christmas Senior Vice President Andrew Challenger said,"Job cuts remained flat in May as companies assess performance and make plans for Q3 and Q4. Meanwhile, hiring announcements are at their lowest levels in a decade. The typical churn in a healthy labor market appears to be stalling."

Hiring intentions are down 56.8 percent to 4,236 in May after 9,802 in April, and down 46.3 percent from 7,885 in May 2023. One reason for the weakness could be the perceived lack of labor supply in industries that normally take on workers in the spring for the summer vacation period. Businesses are in a constant state of recruitment rather than making big seasonal pushes to hire.

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.