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Don't Spend Your Holiday Bonus Just Yet
Things were quiet on the job front in October. Too quiet.
Financial services sector job cuts were down 71 percent in October from their August high. Of course, that's not saying much considering a whopping 35,752 finance jobs were axed in August.
Layoffs fell 24 percent to 27,169 in September, according to data collected by outplacement consulting firm Challenger, Gray & Christmas, then another 61 percent to 10,515 cuts totaled in October.
Sounds promising—but keep in mind that the record-breaking 140,442 job cuts announced by financial firms through October of this year compares to a reduction of 50,327 positions for the same period in 2006. October's supposedly encouraging headcount is still almost double what it was last year.
Are cuts are winding down for the year, or is it just the calm before the storm?
One the one hand: it looks sort of like the economic version of the scene in every horror movie where the victims breathe a sigh of relief, only to lain to waste by the villain seconds later.
Judging by the string of heavy write-downs posted in October, including Merrill's whopping $8.4 billion quarterly loss, one can't help but think that there will be some additional bloodletting on Wall Street before the year is up.
On the other hand, the hatchet jobs across the industry in August and September may indicate a pre-emptive scaling back of resources, possibly even a panicked, overcompensating effort to lower the bottom line as soon as possible in the midst of crisis.
Two months of declining numbers do not a trend make, so it's still anybody's guess what the last two months of 2007 have in store for us. The holidays are nearly upon us, so every banker boy and girl ought to be praying they don't wake up with coal in their stocking.
by Liz Gunnison
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