” US records 3% surge in job cut announcements ” | GNN INFO

WEB DESK: Layoff announcements in the United States experienced a 3 per cent surge last month, reaching the highest level in 11 months, according to a report released on Thursday.

The rise is attributed to ongoing restructuring driven by automation, which continues to impact various sectors.

Outplacement firm Challenger, Grey & Christmas reported that job cut announcements reached 84,638 in February, marking the highest figure since last March and a notable increase from January’s 82,307.

Although this represents the highest total for February since 2009, year-to-date figures for 2024 show a 7.6 per cent decrease in cuts compared to the same period last year.

In February, significant job cuts were observed in the technology sector, along with the transportation and services industries.

Despite leading in job cuts for the year, the tech sector witnessed a 55 per cent decrease year-to-date compared to the same period in 2023. Conversely, the finance sector saw a 56 per cent increase in cuts compared to last year.

Layoffs were primarily attributed to restructuring efforts and closures of plants, units, or stores, according to Challenger. Technological updates were cited as reasons for 15,225 cuts through February.

Andrew Challenger, senior vice president of the firm, suggested that some companies might be concealing cuts associated with artificial intelligence under different labels.

He noted, “In light of the backlash some companies have faced for directly attributing job cuts to artificial intelligence, they appear to be framing this shift as a ‘technological update’ rather than an outright substitution of human roles with AI.”

Challenger said that companies are not only implementing AI but also incorporating robotics and automation, with AI alone being cited in 4,247 job reductions last year, indicating a growing impact on company workforces.