Layoffs are on the rise
Published: Friday, January 9, 2009 at 6:01 a.m.
Last Modified: Thursday, January 8, 2009 at 10:32 p.m.
WASHINGTON - Pink slips are piling higher as companies scramble to cut costs even deeper to survive the country's economic and financial storms.
Just days into the new year, managed care provider Cigna Corp., aluminum producer Alcoa Inc., data-storage company EMC Corp. and computer products maker Logitech International were among those announcing layoffs to cope with a recession that has just entered its second year.
A barometer on layoffs is expected to show Thursday that the number of newly laid off people signing up for state unemployment insurance last week rose to 540,000, up from 492,000 in the previous week, according to economists' projections.
The number of people continuing to draw jobless benefits is projected to stay near 4.5 million, demonstrating the troubles the unemployed are having in finding new jobs.
Electronic unemployment filing systems have crashed in at least three states in recent days due to the crush of newly jobless Americans seeking benefits.
"Businesses were panicked at the end of the year and those that had been holding off on layoffs are now capitulating," said Mark Zandi, chief economist at Moody's Economy.com.
For all of 2008, employers likely slashed payrolls by at least 2.4 million. That's based on economists' forecasts for a net loss of 500,000 additional jobs in December, as well as the job losses already reported every month last year by the government. Some, however, think the number of jobs cut last month will be higher - around 600,000 or 700,000. The Labor Department will release that report today.
Consumers and companies are folding under the negative forces of the collapsed housing market, a global credit crunch and the worst financial crisis since the 1930s. The recession, which started in December 2007, already is the longest in a quarter-century.
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