Labor Day Often Means Job Losses
Aug. 16, 2006 — -- Labor Day may be a celebration of the American worker, but according to some employment experts, it is also the weekend when workers become most vulnerable to being fired.
Some big companies have recently announced cuts, and more could be coming.
"In six [years] out of the last 10 years, downsizing was heaviest in the last four months of the year. After Labor Day, it really seems to pick up," said John Challenger, who runs a Chicago job placement firm.
With a combination of high energy prices, increased interest rates, and the end of the housing boom, Challenger forecasts a stormier job market this year than usual.
"We have seen a heavy space of job cuts in the last month from well-known names, big companies," he said. "As the larger companies start seeing a falloff in their orders, often the economy follows along with it."
At Eastman Kodak, 2,000 jobs have been targeted, and at The New York Times, more than 1,000 jobs are on the line.
In Hollywood, Calif., Superman may have returned, but his powers could not help Warner Bros. avoid layoffs.
MGM and Disney -- which had the biggest hit of the summer with the "Pirates of the Caribbean" sequel -- also slashed jobs recently.
In Virginia, AOL announced 5,000 pending layoffs, and employees are bracing for pink slips.
This week, retail giant Wal-Mart posted its first profit decline in a decade, so people there are worried as well.
How can you gauge what might happen where you work?
"You want to look for signals, whether it is sudden management changes or resignations or cutbacks or announcements of things like hiring freezes," said Tory Johnson, the CEO of Women for Hire and "Good Morning America's" workplace contributor.
"Those can give you clues that perhaps something is about to happen."
One indicator of the economy's overall health is that corporate profits have been up every quarter for the last 2½ years.
That's good news, except that one reason profits have increased is because of layoffs and companies making do with fewer people.
Unemployment is still relatively low at 4.8 percent, so generally, laid-off workers have been able to find new jobs.
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