Layoffs from dot-coms are down slightly in May from April’s record of more than 17,000 layoffs, but the total job cuts in just the first five months of this year add up to almost 60 percent more than in all of last year.
In a monthly analysis by Challenger, Gray & Christmas Inc., dot-com layoffs in May totaled 13,419, the second-highest total after last month’s record 17,554 job cuts, according to the outplacement firm’s figures, which were released today.
For the year so far, the May layoffs bring the total dot-com job cuts to 64,983, up 58 percent from 41,214 layoffs in all of last year. From January through May last year, only 3,315 dot-com layoffs were announced.
The Chicago-based company also reported that the number of dot-coms closing their doors also increased from 13 in April to 29 this month, a 123 percent increase.
The 2001 figures are significantly higher than last year’s figures, according to Challenger, Gray & Christmas. In May 2000, there were 2,660 job cuts and eight closings, the company said in its report.
Internet technology vendors, including those selling servers and networking equipment, had the highest number of layoffs, with 5,860 job cuts, said the report.
Second in the survey were layoffs at consumer goods dot-coms, with 3,462 cuts in May. Professional service firms announced 2,265 cuts.
John A. Challenger, CEO of Challenger, Gray & Christmas, said in a statement that although the layoff and closure numbers are up, they don’t mean doom and gloom for the industry as a whole.
“Despite the slump we are seeing among dot-coms and technology firms in general, it would be a mistake to discount or underestimate the impact these areas have had and will continue to have on the economy as well as our society,” he said. “This is evident from the enormous demand that still exists for people with high-tech skills.”
One good thing that could come out of the layoffs, Challenger said, is that high-tech workers with dot-com experience in Silicon Valley can take their experience to other regions of the U.S. where they are needed, widening the field of available talent to other parts of the nation where they are “starving for high-tech workers.”
