Wednesday, February 4, 2009

U.S. companies cut 5,22,000 jobs in January

New York (PTI): Private sector companies in the U.S. slashed a stunning 5,22,000 jobs in January, in yet another indication of the worsening labour market situation.

The latest ADP (Automatic Data Processing) Inc report showed that non-farm private employment on a seasonally adjusted basis, declined 5,22,000 in January 2009.

The ADPNational Employment Report is based on anonymous payroll data and is maintained by Macroeconomic Advisers.

In a statement on Wednesday, ADP said the report for January estimates "non-farm private employment in the service-providing sector fell by 2,79,000."

While the goods-producing sector shed 2,43,000 jobs, the manufacturing industry saw the loss of 1,60,000 jobs last month.

According to the report, large businesses which are defined as those with 500 or more workers, slashed 92,000 jobs. Further, medium-size and small-size entities reduced their workforce by 2,55,000 and 1,75,000 employees, respectively.

Medium-size companies are those having 50 to 499 people whereas small-size firms are described as those with less than 50 workers.

"Sharply falling employment at medium-and small-size businesses clearly indicates that the recession continues to spread well beyond manufacturing and housing-related activities," the statement noted.

Moreover, employment in the construction dropped by 83,000 jobs. "This was its twenty-second consecutive monthly decline, and brings the total decline in construction jobs since the peak in January 2007 to 9,23,000," it said.

The report pointed out that estimated change of employment from November to December 2008 was "revised up by 34,000, from a decline of 6,93,000 to a decline of 6,59,000."

In recent months, many of the American corporate giants including Microsoft, Caterpillar, Pfizer and Home Depot had announced massive job cuts.

Construction equipment manufacturer Caterpillar and pharma major Pfizer alone would be slashing as many as 20,000 jobs each.

Last week, official data showed that the U.S. GDP declined 3.8 per cent in the fourth quarter of 2008.

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