But wait, there’s more.
Challenger, Gray & Christmas is the nation’s first and oldest outplacement consulting firm. You know what that means; these are the job cuts guys. The firm’s most recently released report displays some rubbish numbers for the auto industry, which lead August in job cuts.
To be more specific, automotive accounted for 17,233 job cuts - a nice chunk out of the 88,736 cuts for August. Year-to-date, the automotive industry has tallied up a significant 80,323 cuts. This is nearly an 83 percent increase year-over-year from 43,897 cuts in August 2007.
Data: Challenger, Gray & ChristmasWhen I spoke with John Challenger, CG&C’s Chief Executive Officer, in July, he did not seem to believe we would surpass one million cuts for the year. Granted, many things have changed since and it appears that the markets will breach that epic number.
In his latest report, Challenger said “We have not seen this level of summer job cutting since 2002, when the country was still struggling to recover in the wake of the 2001 recession and September 11.”
I assume that at the current pace we will reach somewhere in between the levels of 2002 and 2003; approximately 1.2-1.4 million job cuts for the year 2008. Please note the graph “Yearly Job Cuts.” You can see the level we are at year-to-date compared to previous year totals.
Data: Challenger, Gray & ChristmasClearly, this will yield a sizable impact on the auto builders. Not only will they be shedding staff to compensate for their cash burns, the companies will also experience even poorer sales due to less consumer spending.
With this in mind, I reinforce my position on September’s US SAAR Total Sales data coming back weaker from August.
Get out your helmets. It is going to be a rough ride into 2009.
rp
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