January 27th, 2009 by InvestorPoint
A bloody Monday saw over 70,000 jobs lost across almost every business sector in what may be just the tip of the iceberg.
After a net lose of 2.6 million jobs in 2008, the most in 5 decades, this year appears to be continuing the trend. After just 16 business days the total number of jobs lost now exceeds over 200,000 after yesterdays layoffs were announced. This promised to be a big week for earnings reporting and after Monday’s shaky start expect more layoffs as Dow Jones and S&P 500 components continue to report.
The layoffs bring our unemployment rate to 7.2 percent, its highest rate in 16 years. Many analysts are predicting more pink slips and more wage freezes as companies look for ways to survive this recession. Some analysts’ projections call for a net loss of at least 2 million jobs and the unemployment rate could hit 10 percent or higher by the early next year.
Some Notable Companies:
Caterpillar (CAT) it will cut 5,000 more jobs than previously planned to a total of 20,000 in an effort to deal with what they call a “very challenging global environment”. The workforce reduction will be made up of 8,000 independent contractors and 4,000 production employees. The remaining positions will be primarily management and administration.
Sprint Nextel Corp (S) announced it will cut 8,000 jobs or about 14 percent of its work force. While all parts of the company will be affecting, the reductions will be less in customer care in an effort to raise customer satisfaction. The resulting $1.2 billion in labors costs come as they trying to become “financially secure in a challenging economic environment.
Texas Instruments (TXN) announced Monday it will eliminate 3,400 because demand has continued to weaken with the slowing economy after reporting an 86 percent decline in fourth quarter profits. The reductions, representing 12 percent of its workforce, will be made through 1,800 layoffs and 1,600 voluntary retirements and departures.
Pfizer (PFE) announced it will acquire Wyeth in a $68 merger creating the world’s “premier Biopharmaceutical Company”. The merger will result in the closing of five factories and the elimination of 19,000 jobs, or 15 percent, of the combined companies’ payroll.
Home Depot (HD) announced it will close the Expo designer center business and will cut 7,000 employees representing 2 percent of their total workforce. The majority of the cuts are the result of the company’s decision to close the 34 Expo Design Center stores as the businesses had “not performed well financially and is not expected to anytime soon”
The only organization hiring is the Internal Revenue Service which is looking for “hundreds” of new IRS officers to help the government collect more tax revenue.