DuPont layoffs reflect broader job market woes

Other industries shed workers even as the US economy continues to heal.

By Jonathan Berr Oct 23, 2012 12:16PM
Business hand receiving a pink slip copyright Tom Grill, PhotographerDuPont (DD) isn't the first company to announce layoffs during this dismal earnings season, and it won't be the last. Many Americans continue to struggle as the economy regains its footing. Sadly, the 1,500 job losses at the chemical giant are a drop in the bucket compared with what's going on elsewhere. 

Bank of America
(BAC) recently announced plans to slash 16,000 jobs, and more banking industry layoffs loom as institutions adjust to the changing regulatory environment. 

Hewlett-Packard (HPQ), which is struggling to reinvent itself in the post-PC world, is slashing 27,000 jobs. And like many manufacturers, Caterpillar (CAT) is idling production at some plants because demand is lackluster as economic growth slows.

Though it's cold comfort to people who have lost their jobs, the economy is better than it was, which may make finding a new job easier. Economists are forecasting U.S. GDP to grow 1.9% this year and 2.4% next year. While those figures are down from earlier forecasts, at least the U.S. economy is growing at a time when economies in parts of Europe are contracting. 

Unemployment is now below 8% and should continue to drop with a hiccup or two over the next year or so. It seems unlikely that the rate will move significantly higher, even with the new job cuts.

U.S. employers announced plans to cut 33,816 jobs in September, which is a 4.9% increase over August but a 71% decline from a year earlier, according to data from Challenger, Gray & Christmas. The National Retail Federation is forecasting seasonal hiring this year of between 585,000 and 625,000, which is in line with last year. A rebound in the real estate market certainly helps keep the economy on a firm footing.

During his re-election campaign, President Barack Obama has argued that the economy would have been in worse shape were it not for his policies. Though many economists say he is right, that's like telling someone with a broken leg that he should feel lucky that he doesn't have cancer. Though it's not usually fatal, breaking a limb is certainly no fun either.

Jonathan Berr does not own shares of the listed stocks. Follow him on Twitter@jdberr.


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