U.S. Layoff Announcements Hit Three-Month Low

(Reuters) – U.S. layoff announcements tumbled in October to a three-month low, indicating a healthy job market ahead of the presidential election, according to a report by Challenger, Gray and Christmas.

Firms announced 55,597 layoff in October, a 23.7% decrease from the 72,821 reported in September. Layoffs would have been even lower were it not for over 18,000 job cuts in the aerospace sector, with approximately 17,000 coming from Boeing, which is contending with an ongoing strike.

Year-to-date, 664,839 layoffs have been announced through October, which is 3.7% higher than in the first ten months of 2023. This total marks the highest since 2020, when about 2.16 million layoffs were reported during the same period due to the COVID pandemic.

Andrew Challenger, senior VP of Challenger, Gray and Christmas, noted, "Job openings have fallen and hiring is pretty flat at the moment. Companies appear to be in a holding pattern as we await election results and potential regulatory changes."

While the economy ranks high among voter concerns, persistent inflation remains the top issue. This situation poses challenges for incumbent Democrats with Vice President Kamala Harris as their presidential nominee. Polls indicate that voters lean toward the economic proposals put forth by Republican former President Donald Trump.

The federal government's measure of layoffs, derived from new unemployment benefit applications, rose briefly earlier this month due to Hurricanes Helene and Milton and the Boeing strike but returned to lower levels mid-month.

Despite the gradual increase in unemployment benefit recipients exceeding one week, the job market is viewed as healthy, yet regaining balance. The next Labor Department update is scheduled for Thursday.

Challenger's report was released a day before the Bureau of Labor Statistics' nonfarm payroll report, which is expected to show an addition of 113,000 jobs in October, a decline from 254,000 in September. The unemployment rate is anticipated to remain unchanged at 4.1%.