While we’re being told first time unemployment claims are going down……did you hear this?

Announced U.S. Job Cuts Rose 20% From Year Ago

Employers in the U.S. announced more job cuts in February than in the same month last year, led by a surge at government agencies.

Planned firings increased 20 percent to 50,702 last month from February 2010, the first year-over-year gain since May 2009, according to a report today from Chicago-based Challenger, Gray & Christmas Inc. Announcements at federal, state and local government offices almost tripled from last year.

“More job cuts at the federal level are expected in the months ahead as pressure mounts to cut costs and rein in the soaring national debt,” John A. Challenger, the outplacement company’s chief executive officer, said in a statement.

Dismissals of government workers may contribute to a slowdown in consumer spending, which accounts for 70 percent of the economy. Combined with the highest gasoline prices in two years, the threat of a pause in purchases may already be causing retailers, which had the second-biggest number of announcements last month, to pare payrolls, said Challenger.

“If gasoline tops $4 per gallon in the coming weeks, consumers may be forced to make significant changes to their spending habits,” said Challenger. “At this stage of the recovery, that could be an extremely damaging setback.”

Compared with last month, which saw the fewest firings for any January since record-keeping began in 1993, job-cut announcements climbed 32 percent. Because the figures aren’t adjusted for seasonal effects, economists prefer to focus on year-over-year changes rather than monthly numbers.

Government Firings

Government and non-profit agencies led the February job cuts with 16,380 announced reductions, according to Challenger. Retail firms had 8,360.

Today’s report also showed that employers announced plans in February to hire 72,581 workers, up from 29,492 the prior month. The surge reflects Home Depot Inc.’s announcement that it planned to add 60,000 temporary workers, Challenger said.

Entire article at Bloomberg.com

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