Only one U.S. company announced a four-figure layoff count last week, and the Labor Department reported that new jobless claims fell more than expected the week before. Could it be the beginning of the end of the employment plunge?
It may be too early to say that: continuing unemployment claims set a new record for the eighth straight week. But outlier predictions for a 12 percent jobless rate are now starting to seem far-fetched, given the significant slowdown in layoff announcements in the past six weeks.
Last week’s layoff leader was Caterpillar Inc., which said it will eliminate 2,200 production factory—related jobs, on top of the 22,000 job cuts the company announced in January. In February it offered a voluntary early-retirement incentive package to another 2,000 production employees.
FedEx Corp., which last week reported a 75 percent drop in diluted earnings per share for its third quarter ended February 28, announced it will further reduce personnel and work hours. However, the company did not say how many employees will be affected.
“Our goal when we implemented compensation reductions in January for U.S. salaried personnel was to both protect our business and minimize the loss of jobs,” said chairman and CEO Frederick Smith. “With industrial production and global trade trends worsening since last quarter, we are applying these additional measures to continue to secure as many of our jobs as possible during this downturn.”
The only other significant job-cut announcements last week took place overseas. Finnish cell-phone maker Nokia Corp. said it will lay off 1,700 employees globally. It did not say how many would be in the United States. Meanwhile, The Financial Times reported that German industrial conglomerate ThyssenKrupp plans to cut more than 3,000 jobs. There would be scant impact in this country.
Many economic and market experts believe Europe is months behind the United States in the current crisis, and that unemployment will peak here first.