Eight companies announced job cuts this week as a means of cost-cutting during desperate times, representing industries as widespread as retail, finance, leisure, pharmaceutical and toy and automobile manufacturing.
On Friday, the Labor Department reported that the U.S. economy sloughed nearly 1.2 million jobs through October. Just in the month of October, the economy lost 240,000 jobs, raising the unemployment rate to 6.5%.
"We're losing jobs just about everywhere," said Robert Brusca, chief economist and Fact and Opinion Economics. "People are slowing their spending on everything. Now, even wealthier people are reluctant to spend money."
Circuit City (CC, Fortune 500), an electronics retailer based in Richmond, Va., kicked off the week by announcing on Monday that it was reducing its domestic workforce by 17%. The company would not comment on the number of employees that would be affected, but according to a recent 10K filing, Circuit City employs about 43,000 people in the U.S. That would mean roughly 7,300 positions are being lost, the biggest of the cuts in November so far.
On Tuesday, the Connecticut-based insurer Hartford Financial (HIG, Fortune 500) reported 500 cuts.
The following day, the British drug company GlaxoSmithKline (GSK) said it would cut 1,000 sales positions.
Thursday was particularly gloomy, with four companies announcing cuts: 1,300 from Fidelity Investments of Boston, 1,000 from toy maker Mattel (MAT, Fortune 500), based in El Segundo, Calif., 375 from Borgata Hotel Casino of Atlantic City, N.J., and 850 from La-Z-Boy (LZB), a furniture producer and retailer based in Monroe, Mich.
Ford Motor (F, Fortune 500) was the most recent to announce job cuts, with 2,600 cuts announced on Friday. The battered auto maker said it was trying to hold on to its dwindling cash reserves as it reported a $3 billion operating loss for the third quarter.
Most of the cuts are slated for the U.S., though Mattel said its job cuts will affect its global workforce.
"You have essentially every sector, every industry, furloughing workers, so it's going to get bad - considerably worse - before it gets better," said Richard Yamarone, director of economic research at Argus Research. "If the automotive sector falls, and it's on the ledge, then you could very easily have double-digit employment."
Lakshman Achuthan, managing director of the Economic Cycle Research Institute, said that Hartford and Fidelity are getting squeezed by the plunging value of the stock markets. But he said the other companies - and even the drugmaker GlaxoSmithKline - are getting stifled by a consumer lock-down on any type of spending that is not totally necessary.
"You don't have to buy a La-Z-Boy today, but you might have to go to the doctor, you have to eat, and you have to pay rent," said Achuthan. "[The companies] are seeing that the consumer has been stunned or is frozen and will not make any purchases that he will not absolutely have to make."
As for Glaxo, Achutan said that many Americans get their health insurance through their jobs, and when they lose their jobs, it affects the drugmakers. He said newly-uninsured people are spending their money on food and housing, instead of drugs.
Lawrence Mishel, president of the Economic Policy Institute, dismissed any notion that the job market would pick up in 2009, given the omnipresent nature of the layoffs, and the fact that they stem from a "credit freeze on top of a recession caused by a housing meltdown."
"The fact is that we're going to have very high unemployment for several years," said Mishel.
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