A Janco Associates survey that I wrote about earlier this week said that IT layoffs seem to have tapered off, a finding borne out by global outplacement firm Challenger, Gray & Christmas in a report released Wednesday.
It calls Cisco's planned 6,500 job cuts the largest announced tech downsizing of the year. Those cuts will be part of Challenger, Gray & Christmas' third-quarter report.
In the first two quarters of the year, tech companies announced just 14,308 job cuts, a decline of 60 percent from the 35,375 cuts during the same period a year ago. Though that was up from 11,450 job cuts announced by telecommunications, electronics and computer firms in the final six months of 2010, the increase probably does not signal a resurgence in tech-sector downsizing, the report says.
The Cisco cuts notwithstanding, the overall health of the technology sector remains very strong. In fact, it is one of the best-performing industries in the economy at the moment. It is highly unlikely that planned layoffs in the second half of the year will be heavy enough for the year-end total to surpass last year's record low 46,825 job cuts.
The tech-sector job cuts make up just 5.8 percent of the 245,806 job cuts announced across all industries in the first half of the year.
Layoffs at computer companies plunged 81 percent, from 16,964 in the first half of 2010 to 3,178 this year. Pharmaceuticals was the only sector in which layoffs declined more, by 86 percent from 34,987 to 4,771.
And despite the worry over jobs lost in the sector, telecommunications layoffs dropped 57 percent from 16,005 in 2010 to 6,813 this year. While the electronics industry continued to shed jobs - layoffs grew by 79 percent from 2,406 a year ago to 4,317 this year - the report calls that number "still very low by historical standards."
And noted Challenger:
As many sectors outside of government continue to see relatively low downsizing activity, the tech sector is one of the few areas actually adding workers. Through June, companies in the sector announced plans to add nearly 26,000 workers, which represents just a small portion of actual hiring, since most employers do not formally announce hiring plans.
Despite the grim number of jobs created in the overall economy in June, the U.S. Labor Department found hiring taking place in tech. And CareerBuilder's 2011 Mid-Year Job Forecast ranked IT as the No. 2 area in which businesses plan to hire through the end of the year.