Workplace Issues

Job Cuts Continue to Rise In Energy Sector

Layoffs at U.S. companies in February were up 22% from a year ago.
Katie Kuehner-HebertMarch 3, 2016
Job Cuts Continue to Rise In Energy Sector

Layoffs across the United States slowed in February, though downsizing in the energy sector continued to rise due to prolonged weak oil prices, according to Chicago-based consulting firm Challenger, Gray & Christmas.

After surging to a six-month high to begin the new year, downsizing slowed in February, as U.S.-based employers announced 61,599 job cuts during the month, 18% fewer than the 75,114 in January. The February total was up 22% from a year ago, when employers announced 50,579 job cuts.

Planned layoffs totaled 136,713 through the first two months of the year, up 32% from the same period in 2015, when employers announced layoffs totaling 103,620 in January and February.

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Just as in 2015, the energy sector has seen the heaviest job cutting in the opening months of the year, Challenger, Gray & Christmas found. These firms announced another 25,051 job cuts in February, bringing the year-to-date total to 45,154.  Most of the cuts in the sector have been attributed to low oil prices.

The 45,154 energy industry cuts through February represents a 24% increase from 2015, when employers in the sector announced 36,532 planned layoffs in the opening two months of the year.

“Low oil prices continue to take a toll on workers in the energy and industrial goods sectors,” which together posted workforce reductions in excess of 200,000 over the past year, chief executive John A. Challenger said in a press release. “Shockingly, we have not seen a precipitous rise in unemployment in the many cities that were benefiting from the recent oil boom, suggesting that the job losses are contained to the energy sector, for the moment.”

The tech sector also reported increased job cuts. Announced layoffs by computer industry businesses this year totaled 16,006, a 143% increase from the 6,582 job cuts recorded in the first two months of 2015.