New data on layoffs for 2024 now paint an unexpected picture as job cuts hit their highest levels since 2009, sources report.
Layoff announcements in February hit their highest level for the month since 2009, Challenger, Gray & Christmas reported on Thursday.
With a series of high-profile layoff waves, tech leads the way this year in cuts with 28,218, though that number has fallen 55% from the same period a year ago, says CNBC.
“From a historical perspective, this was the worst February since 2009, which saw 186,350 announcements as the worst of the financial crisis was seemingly coming to an end,” reported the outlet.
“Financial markets bottomed the following month, paving the way for the longest economic expansion on record, lasting until the Covid pandemic in March 2020.”
For the year, companies have listed 166,945 cuts, a decrease of 7.6% from a year ago.
“As we navigate the start of 2024, we’re witnessing a persistent wave of layoffs,” said Andrew Challenger, the firm’s labor and workplace expert.
“Businesses are aggressively slashing costs and embracing technological innovations, actions that are significantly reshaping staffing needs.”
With a series of high-profile layoff waves, tech leads the way this year in cuts with 28,218, though that number has fallen 55% from the same period a year ago.
Layoff announcements at financial firms have risen 56% compared with the first two months of 2023.
Other industries planning significant cuts include industrial goods manufacturing (up 1,754% from a year ago), energy (up 1,059%) and education (up 944%).
The layoff numbers, however, are not feeding through to weekly jobless claims, suggesting that unemployment is short-lived and workers are able to find new positions.
Initial filings for unemployment insurance totaled 217,000 in the most recent week, unchanged from the previous period and exactly in line with Wall Street estimates.
Challenger’s experts say companies most often cite restructuring plans as the main reason for the reductions in workforce.
Artificial intelligence has been cited for just 383 cuts, though “technological updates” in general have been at the root of more than 15,000 reductions, or nearly as much as all the years combined since 2007.
“In truth, companies are also implementing robotics and automation in addition to AI.
It’s worth noting that last year alone, AI was directly cited in 4,247 job reductions, suggesting a growing impact on companies’ workforces,” Challenger reported.
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Also Read: A New Wave of Unexpected Layoffs Now Hits Illinois
Other Economy News Today
A leading manufacturer now declares an unexpected bankruptcy after partnering with a Chinese company, sources report.
The manufacturer, which opened in 2013, has been a pioneer in the LED lighting space.
And, while Rohinni may not be a household name, it has been a leader in its space, reports TheStreet.
The company’s mission led to a 2019 partnership with BOE, a Chinese company that called itself “a global leader in semiconductor display industry as well as an IoT company providing intelligent interface products and professional services for information interaction and human health,” according to its website.
It was a deal that was supposed to help Rohinni grow, which may have led to its downfall, says the outlet.
“This joint venture will bring Rohinni’s market-ready technology which is three to five times quicker than traditional pick-and-place processes, capable of placing 50 die-per-second (dps) with 10 micron accuracy at 99.999% die yields to consumer products,” the companies shared in a press release.
However, that proved to be the wrong bet for Rohinni as demand tailed off quickly in China, where the company was required by the terms of the deal, to do most of its business.
The company filed for Chapter 7 liquidation with the Eastern District Court of Washington.
The company reported a whopping 96% drop in revenue in 2023, according to the court filings.
After its abrupt closure, Rohinni reported $5 million in liabilities and $40.4 million in assets, which sounds like a company that should still be solvent.
Unfortunately, many of their assets are tied to exclusive-use agreements with a Chinese joint venture company.
The bankruptcy court will have to decide what happens to the over 100 patents the company holds, many of them jointly with BOE.
Rohinni’s deal with its Chinese partner limited its ability to sell off some of its assets to raise cash.
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Also Read: This Popular Mall Retailer Is Now Closing 150 Stores
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