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Challenger Job Cuts Surge 19%; Energy Sector Is 38% Of Total: "Falling Oil Hasn't Resulted In Higher Retail Spending"
A month ago we asked if, perchance, the BLS had simply forgotten to add any of the job losses in the energy sector in January, when it reported a drop of just 1900 jobs in the entire Oil and Gas Extraction space, compared to 18K actual announcements, and 21,300 job cuts in the sector as reported by Challenger. Moments ago, the latest Challenger data is out, and we really hope the BLS finally reads it because things in the energy sector are getting worse by the day, if only for its well-paid workers.
According to Challenger, the February total planned job cut were over 50,000 for the second month in a row, or a total of 103,620 in the first two months of 2015, up 19% from the same period last year, with a 38% of the total, or 39,621 of these job cuts, due to plunging oil prices and about to take place in the highest paid oil extraction space.
From the press release:
Employers announced 103,620 planned layoffs through the first two months of 2015, which is up 19 percent from the 86,942 job cuts recorded during the same period in 2014.
Once again, the energy sector saw the heaviest job cutting in February, with these firms announcing 16,339 job cuts, due primarily to oil prices.
Falling oil prices have been responsible for 39,621 job cuts, to date. That represents 38 percent of all recorded workforce reductions announced in the first two months of 2015. In February, 36 percent of all job cuts (18,299) were blamed on oil prices.
Here is the one chart that the BLS, if it ignored everything else, should look at:
To paraphrase John Challenger, it is unambiguously ungood.
“Oil exploration and extraction companies, as well as the companies that supply them, are definitely feeling the impact of the lowest oil prices since 2009. These companies, while reluctant to completely shutter operations, are being forced to trim payrolls to contain costs,” said John A. Challenger, chief executive officer of Challenger, Gray & Christmas.
“While oil-related companies will see profits slide, the net impact of falling oil prices will likely be positive for the economy, as a whole. Some economists are estimating that GDP could see a 0.5 percentage point boost from low oil prices, due mostly to the extra spending power among consumers. Meanwhile, companies that are big users of oil, such as transportation firms, airlines, and manufacturers of plastic and paint products will see higher profits thanks to cheap oil,” noted Challenger.
Yes, in theory, plunging oil is great. In practice however...
Cheap oil does not yet appear to be helping stem the tide of job cuts in the retail sector, which saw the second highest number of job cuts in February with 9,163. Employers in the sector have announced 15,862 job cuts, so far this year. That is little changed from the 15,242 retail job cuts announced in the first two months of 2014.
The punchline: “So far, falling oil prices have not resulted in higher retail spending.” said Challenger. But, but, they promised.
And finally, here is how the YTD job cuts look when compared between the BLS and Challenger:
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Moar duct tape, chewing gum and baling wire please.
Nah, this is clearly a job for Sham-Wow.
Those are going to be tough to make up. Extraction was one of the few industries that paid well.
Maybe they can all be longshoremen?
pods
Clearly things are going well.
Layoff / Closing List: http://www.dailyjobcuts.com
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What gas savings. Oil is down but pump prices are right back up. Since they fired everybody in shale some bodies pocketing the difference.
I believe most of it are the union employees striking at refineries limiting the capacity of oil refineries. Don't say a union has not done anything for you lately.
The economy is horrible...strike and ask for raises!
The cap-and-trade for fuels is a regulation already adopted by the California Air Resources Board that will increase the cost of gasoline and diesel fuels by up to 76 a cents a gallon, according to the agency’s own analysis - See more at: http://cafuelfacts.com/cap-and-trade-for-fuels/#sthash.hc8xwHVG.dpuf
http://cafuelfacts.com/cap-and-trade-for-fuels/
Great, who is getting their cut?
BIG GREEN ARROW up on that one. The price of gas was the fastest boomerang in retail pricing I've ever seen for ANYTHING, EVER. The price at the pump is recovering faster than you can say, "$80 a tank".
should be good for another handle up on the spoos
19%increase in truth?
Green shoots.
Remember Standard Oil monopoly?
Energy Company’s Consolidate…….Oil Price Cut Working
ExxonMobil Boosts Drilling Rights in Russia Giving It More Holdings There Than in U.S.
I invested the gas savings into more solar panels which will give me energy for years to come . FREE
solar panels..hmm if you live in a desert perhaps, most of us live where it's dark at night and cloud cover is common. oh and watch any trees that drop branches on those robust panels, or large hail..in maryland they regulate solar power, tax to follow..so free until you pay a tax, like we do in maryland for rain fall on our land that the state says : all rain is ours. we live in a time where nothing is free - the pols will see to it you pay.
WHY do you pay a tax for rain? Seriously, why would anyone pay that? Why aren't people suing like crazy?
I've heard this before from other people...but never any details. I'm thinking there's GOT to be more to the story, if true...
bemused asks why?? lol because they can, it's for clean water and such, as you know the states clean rain gets dirty running off my property, so somebody got to pay. you can look up maryland rain tax it's not like it's prohibited on google.
It's to pay to clean the bay you stupid Fucks for polluting it for the last 100 years
Not that I agree on how they get the money.
In NJ they consolidate their taxes in the form of nearly the highest property taxes in the country. Just be glad you are getting nickled and dimed occassionally and not raped by the tax man. NJ is Chicago east.
My co-worker moved to the Houston area--his property taxes are 3.6%. That's a big hickey on a $525k house every year. Is NJ higher then that?
Yes, that is higher than NJ. The higher amounts in NJ on average are in the $10K-$15K for houses in that range.
Ok, but you are not challenging this, why? You say "they can", well, yeah...they CAN do anything I suppose, and get away with it if no one is willing to give them a real rough ride on it...But most people seem to think it's too much trouble, not worth it, you can't win, etc...
You can't just complain. You have to make a real stink, and prepare to take no prisoners. What would you do if they passed an "air tax"? Pay it?
Well, if you meekly pay the "rain tax", what ARE your limits?
Well it appears to me that what should happen is. Also looks like a bunch of folks in the oil bidness hung all their plans/hopes on oil running at $100.00 forever.
Shit happens and things adjust!
Now we are all set for the BLS to say the exact opposite in their next bullshit release.
Grandma Yellen will fix it with another pot of steaming shit soup
Grandpa , I fixed it for you.
Green shoots? Bullish!
Looks like the unemployment bottom has been hit. Starting that rising trend just like in '06-'07.
-Challenger Y/Y layoff rate rising.
-4 week MA of claims on the rising trend.
- productivity dropping yet labor costs spiking.
All bad combos.
The market likes it.
but 5% unemployment - thanks for lying yellen - you foul pig
They can meet with the 50,000 HP cast offs
and figure out which bars to apply for jobs. Firing
on all cylinders.
wait 'till they seasonally adjust the numbers and then hedonistic them; everything will be fine then.
“So far, falling oil prices have not resulted in higher retail spending."
That is about as stupid a statement as it gets.
Those few bucks saved by those potential retail spenders who buy gasoline, hardly makes up for the billions of dollars in lost wages of the laid off oil workers who presumably are doing precious little retail spending.
So you're telling me oil workers spend less money after they've been fired? That's strange because CNBC said the opposite was true.
What a striking resemblence I have to that last bar chart. I love the melty red candles and giant red towers of misery!