Scores of Americans had to brush up their CVs last year.
In 2023, companies planned 721,677 job cuts, a 98% jump from 2022, according to a new report from professional outplacement firm Challenger, Gray, and Christmas. The number marks the highest annual total since 2020.
The year included several high-profile tech layoffs from names like Meta (META) and Amazon (AMZN), who expanded during the earlier stages of the pandemic only to slash jobs later. Mark Zuckerberg even referred to 2023 as Meta's "year of efficiency."
While companies including Spotify, Hasbro, Amazon, and Citigroup laid off employees last holiday season, the Challenger report showed that the biggest increases in job cuts last year took place in the first half of 2023.
“Layoffs have begun to level off, and hiring has remained steady as we end 2023. That said, labor costs are high,” said Andy Challenger, senior vice president at Challenger, said in the report. “Employers are still extremely cautious and in cost-cutting mode heading into 2024, so the hiring process will likely slow for many job seekers and cuts will continue in Q1, though at a slower pace.”
The tech industry led the country in the job cuts with a 73% increase last year to 168,032. That’s just shy of the annual record of 168,395 cuts in tech in 2001.
“The Tech sector will continue to be impacted by the onset of AI, mergers and acquisitions, and realigning of resources and talent,” Challenger added in the report.
In second place came the retail industry with 78,840 job cuts, a 274% increase from the previous year. Healthcare and financial employers came in third and fourth place, respectively.
“While there is a lot of hiring happening in healthcare, we've also seen a lot of turnover there, some more volatility than most industries,” Challenger told Yahoo Finance in an interview earlier this week. “Because like technology, and like finance, those were areas that really spiked and had to come back down to Earth with the changes that were happening in the post-COVID period.”
In addition to the rise in layoffs, other signs have appeared showing that the labor market is cooling. A survey from Challenger released last month showed that 34% of employers didn’t give out bonuses in 2023 up from the 27% that didn’t award company bonuses in 2022 and the highest rate since 2019, when 36% of companies decided not to give their workers bonuses.
A separate report by ADP released Thursday showed that while job gains rose for the fourth straight month in December, pay growth for people who stayed in their jobs slowed from the previous month.
Dylan Croll is a Yahoo Finance reporter.
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