Tech Job Cuts Fall To Three-Year Low

Apr 8, 2004

CIO Update Staff

According to the high-tech job-cut report released today by global outplacement firm Challenger, Gray & Christmas, first-quarter job cuts in the high-tech sector -- which includes telecommunications, electronics, computer and e-commerce -- were 64% lower than the 82,328 cuts announced in the previous quarter and 52% lower than the first quarter of 2003.

According to Challenger, which began issuing its high-tech job cut reports in January 2001, the first-quarter figure is the lowest on record.

Technology cuts represented 11% of the 262,840 job cuts announced in all industries during the three-month period, down from 17% in the first quarter of 2003. By contrast, technology accounted for 32% of all cuts in 2002 and 36% of all cuts in 2001.

In the first quarter, telecommunications firms led all others in job cutting, just as it has in 11 of the previous 12 quarters. Telecom employers announced 20,681 job cuts between January and March, more than four times the number of cuts announced by the second ranked computer industry.

"This may not mean that telecom is the weakest of the technology industries, but it is clearly the most volatile," said John Challenger, CEO of Challenger. "Overall, technology job cuts appear to be waning, a trend which may temper some of the increasingly heated debate over the controversial practice of offshore outsourcing. However, while the latest survey data show that offshore outsourcing is not leading to a surge in job-cut announcements, one can still argue that it is slowing job creation in technology."

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This article was compiled and edited by CIO Update staff. Please direct any questions regarding its content to Allen Bernard, Managing Editor.


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