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This could negatively affect AD revenues on the WEB..From Briefing.com..."CORPORATE LAYOFFS. Layoffs have been picking up. After the close Thursday, Johnson & Johnson (JNJ) announced that they will be cutting about 4% of their workforce, or 4,100 jobs. Yesterday, Boeing (BA) announced they plan to cut an additional 20,000 jobs on top of the 28,000 planned reduction already announced. Kellogg and several other companies announced layoffs yesterday as well. It is not just anecdotal evidence that indicates layoffs are picking up either. The Challenger, Gray & Christmas layoff data, compiled by the placement service of that name, show that for September-October of this year, announced corporate layoffs totalled 165,000 compared to 110,000 in the same period last year. And that was before the announcements the past few days. So, it does appear that cutbacks are occurring, particularly in large multinational firms. These companies, of course, are subject to the impact of weak Asian economies far more than U.S. companies. These cutbacks are also more significant than prior year restructurings, which were generally pro-active and lead to increased efficiencies and profit growth. These layoffs are largely reactive to weakening demand. It is still too early to say that economic conditions are weakening significantly in the U.S., but these layoffs are increasing, and suggest that corporate America is reigning in their spending plans for 1999. Already, private surveys have shown that firms expect to reduce capital spending and that many most expect slower economic growth. The economic data bear close watching now, as weakness will make it that much harder for companies to reach Wall Street's optimistic forecasts for next year. On Friday, the November employment data will be released. Expectations are for a gain of about 165,000 in non-farm payroll employment. That continues the recent soft trend compared to the 250,000 plus gains in the first half of this year. If the trend weakens further, it might be time to start worrying about the economic outlook in the U.S. " |
