Challenger: Tech Job Cuts Highest in Three Years in First Half

Date : 07/16/2012 @ 9:57AM
Source : Dow Jones News
Stock : HP Inc. (HPQ)
Quote : 18.495  0.125 (0.68%) @ 2:34PM

Challenger: Tech Job Cuts Highest in Three Years in First Half

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   By Saabira Chaudhuri 
 

Planned layoffs at technology firms reached their highest level in three years in the first half of the year, inflated by expected cuts that will affect about 30,000 workers at Hewlett-Packard Co. (HPQ), according to outplacement consulting firm Challenger, Gray & Christmas Inc.

Technology firms, including those in computer, electronics, and telecommunications, announced a total of 51,529 job cuts in the first half of 2012, up from the 14,308 cuts announced during the same period a year ago and the largest midyear total since 2009.

While industries overall are cutting back on workers, job cuts across all industries in the first half of 2012 were up a comparably small 15% from the 245,806 total industry job cuts at the same point last year.

Due primarily to the large job-cut announcement by Hewlett-Packard, the computer industry led the way with 34,380 in first-half job cuts, surging from last year's when computer firms announced just 3,178 job cuts from January through June. The computer industry alone announced more than twice as many job cuts in the first half of 2012 than in all of 2011.

"We may see more job cuts from the computer sector in the months ahead. While consumers and businesses are spending more on technology, the spending appears to favor a handful of companies. Those that are struggling to keep up with the rapidly changing trends and consumer tastes are shuffling workers to new projects or laying them off, altogether," Challenger Chief Executive John A. Challenger said.

Job cuts announced by telecommunications firms jumped 92% in the first half to 13,059 in 2012. Meanwhile, job cuts within the electronics industry remained flat.

The declining employment in the technology industry is not supported by sales, which appear to be increasing.

Figures from industry research firm Gartner show that global spending on information technology products is expected to increase 3% this year, however an analysis of job postings by online jobs aggregator Indeed.com found that information technology job postings nationwide declined 7% between June 2011 and June 2012.

Write to Saabira Chaudhuri at saabira.chaudhuri@dowjones.com


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