WASHINGTON D.C.: A report released this week detailed how, in January, layoffs in the US reached a more than two-year high, as technology firms cut jobs at the second-highest rate on record in anticipation of a possible recession.
According to the report by employment firm Challenger, Gray and Christmas, 102,943 workers were laid off in January, a more than two-fold increase from December and an over five-fold rise from last year.
In an effort to work through a downturn in demand and lower consumer and corporate spending due to high inflation and rising interest rates, many major companies, including Microsoft, Amazon and Goldman Sachs, cut thousands of jobs last month.
Andrew Challenger, labor expert and Senior Vice President of Challenger, Gray and Christmas, said, "We are now on the other side of the hiring frenzy of the pandemic years. Companies are preparing for an economic slowdown, cutting workforce and slowing hiring," as quoted by Reuters.
With the Federal Reserve expected to continue raising interest rates to curb inflation, which has remained high after several rounds of rate increases, more job cuts by US companies are expected.
"For companies that ramped up headcount over the past few years, they will likely shrink their workforce as the economy is headed towards a rough patch," noted OANDA analyst Edward Moya, as reported by Reuters.