Major Firms’ Planned Layoffs Set Record

Major corporations announced 108,000 layoffs in January, the highest monthly level in the four years since the figures have been tracked, an outplacement consulting firm said Tuesday.

Chicago-based Challenger, Gray & Christmas Inc. said the level of announced layoffs topped even the worst of the 1990 recession.

Companies often announce their plans in the early part of the year because they set their budgets in the fall and begin implementing them in January. The announced layoffs often take months or years to complete.

The high level of announced layoffs underscores a basic trend in corporate America to downsize, increase efficiency and productivity and cut expenses at a time when profit growth has been slim.

“Although consumer confidence is reportedly at record levels, America’s work force continues to be subjected to a steady stream of cutback announcements,” said James Challenger, president of Challenger, Gray & Christmas.

“Even industries experiencing considerable growth have selectively cut back workers,” he said. “Employers are increasing workloads of existing employees.”

Although the economy is expanding, there has been concern among economists about the level of job creation. The jobless rate is still at 6.7%, which is considered high for this stage of the recovery.

However, the layoff announcements might be skewing the job picture. Big companies tend to announce layoffs but not hiring plans. Small and medium-sized companies may never announce their plans.

“Many of the largest employers that are reducing payroll in one area of operation are adding staff in other departments,” Challenger said.

Sixty-one percent of the layoffs were concentrated in the East, among companies with headquarters in Connecticut, New York and Pennsylvania.

The layoffs announced in January were up sharply from the 31,389 in December. The previous highest number was in January, 1993, when 103,217 job cuts were announced, mostly because of 50,000 cutbacks at Sears, Roebuck & Co.

The biggest job cuts so far in 1994 were in the communications industry, with 17,000 at GTE Corp. alone. Nynex Corp. also announced 16,800 cutbacks, and Pacific Telesis Group 10,000.

The other major layoffs during January were at Scott Paper Co., which announced plans to cut one-forth of its work force, or 8,300 people.

Boeing Co., constrained by low orders from the weak airline industry, also announced 7,000 cuts.