No quick end seen to spiralling US job cuts

More workers may face the axe as cos make cuts before closing year-end books

Reuters BOSTON 

THE USexperienced its sharpest monthly drop in employment in more than three decades during November, and there is no end in sight to the bloodletting as companies search for ways to cut costs. American employers shed far more workers than expected last month — cuts made even before this week’s confirmation that the country has been in a recession for a year. 
    “This clearly demonstrates that the decline is accelerating,” said Tig Gilliam, chief executive of North American operations for Adecco SA, the world’s biggest staffing firm. “It looked midyear like maybe things would get a little bit better, and now the numbers are just dropping dramatically.” The Labor Department said US nonfarm payrolls plunged by 533,000 in November, a steeper fall than the 340,000 decline that economists surveyed by Reuters had expected. It marked the biggest tumble since December 1974 and means the economy has lost some 1.9 million jobs this year. 
    The cutting continued on Friday, with US companies, including General Motors Corp, asset manager Legg Mason Inc, auto parts supplier Gentex Corp, BMC Software Inc and Sonoco Products Co announcing new layoffs. 
    Earlier this week, such blue-chip companies as AT&T Inc, DuPont Co, United Technologies Corp and General Electric Co said they planned to shed workers as they look for ways to cut costs. The range of companies cutting jobs shows the economic contagion that started with the collapse of the US subprime mortgage market, went on to knock the legs out from under the nation’s home prices and sparked a global credit crunch that is hammering the whole economy.
Bleak December: As Americans prepare for the December holidays, typically a season of spending as shoppers buy presents and entertain, more workers may face the prospect of holiday unemployment as corporations make cuts before closing their year-end books. 
    “It’s hard to gauge where the bottom is,” said Sheldon Schur, vice president at Manpower Inc, the world’s No. 2 staffing company. “It will be interesting to see what happens in the first quarter, because December will be another large job-loss month. We’re going to see a lot of employers continue to shed to position themselves for 2009. And the bigger question will be what happens in January and February.” 
    US retailers, bracing for a soft holiday selling season, added fewer seasonal workers in November than in the past two decades. 
    Woolworths cuts 450 jobs 
STRICKEN British retailer Woolworths is cutting 450 jobs from support operations, administrators Deloitte said on Friday, as they remained locked in talks aimed at finding a buyer for the sweets-to-DVDs chain. Separately, US computer games retailer GameStop denied a report by computer games publication MCV that it had made a bid for around half of Woolworths’ 815 stores. Last week, Woolworths’ retail and distribution businesses sank into administration, a form of creditor protection, the biggest British casualty so far of a sharp slowdown in consumer spending. 
Worthington to give pink slips 
METALSprocessor Worthington Industries Inc said it would cut about 300 jobs in its steel processing and metal framing business, citing steep declines in pricing and demand. The company said the job cuts represent about 4% of its total workforce. The metal framing segment will shut down one facility by the end of February and suspend operations at two others, the company added. Worthington expects to record about $5 million in restructuring charges and sees annual savings of about $17 million from these actions. The metal framing segment “continues to be heavily impacted by the steep drop off in construction that has resulted from the global financial crisis,” Worthington said. 

Source: ET, Page 5, 7-Dec-08