The U.S. layoffs in 2018’s first month totaled 44,653, 37.7% more than December’s 32,423, according to a report released by global outplacement consultancy Challenger, Gray & Christmas, Inc. The retail industry led the layoff list with 15,378 job cuts reported for January 2018, showing that the U.S. “retail apocalypse” is still going strong. Texas led in U.S. layoffs by state with 8,951 job cuts announced last month. Even though the January 2018 layoffs were higher compared to that of the prior month, they were 2.8% lower than January 2017’s 45,934 job cuts.
U.S. Layoffs in January 2018: Top Five Industries
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Layoffs By Industry
“Retail, Consumer Products, and Services are all sectors ripe for automation,” said John Challenger, chief executive officer of Challenger, Gray & Christmas, Inc. “This may spell a loss of jobs in the short term, but could create better, higher-paying jobs going forward.”
U.S. Layoffs in January 2018: Top Five Locations
Layoffs by Region and States
Retail Industry Downfall to Continue in 2018
A shift of consumers toward online shopping is the main reason for the retail apocalypse in 2018, as well as the previous year. Retail store closures in 2017 led to the total of 66,500 job cuts. According to the December job report from the U.S. Department of Labor, general merchandise stores had a maximum number of job cuts, impacting about 90,300 employees. Clothing and drug stores lost 28,600 and 18,400 jobs, respectively.
December is usually the month with the greatest amount of shopping and discounts, as well as the most active for hiring. However, December 2017 actually added the lowest number of jobs, with 55% fewer positions reported compared to the same period in prior years.
Some top retailers like Walmart Inc. (NYSE:WMT) are raising hourly wages to find the workers they need. Many states are also increasing their minimum wages, which is good for workers, but not for low-budget retailers. Automation and apps that help shoppers find items in stores are convenient for customers but are costing many jobs in the retail sector.
In 2017, about 7,000 stores closings were announced. According to commercial real estate broker Cushman & Wakefield’s forecast, the retail store closures in 2018 is expected to cross 12,000 locations and see another 25 major retailers file for bankruptcy. Some of the major chains like Gap Inc (NYSE:GSP), The Gymboree Corp, and Walgreens Boots Alliance Inc (NASDAQ:WBA) have already planned to shut a combined over 3,600 stores this year.
Compared to the highest store closings recorded last year, even higher stores closing is expected in 2018 which will contribute toward retail layoffs in 2018.
“2018 January Job Cuts Report: Cuts Jump 38 Percent; Retail, Consumer Leads,” Challenger, Gray & Christmas, Inc., last accessed February 17, 2018.
“Jobs everywhere! Except at stores,” CNN, January 5, 2018.
“Retail Apocalypse: 12,000 Store Closings Expected In 2018, Following 9,000 In 2017,” Technocracy News & Trends, January 2, 2018.