Outplacement consultancy firm Challenger, Gray & Christmas has released its monthly breakdown of layoffs. The good news? Pharma layoffs are down 16 percent in 2010 over the same time period in 2009. And the even better news is that February's layoff total marks the lowest monthly total since June 2006, when employers announced just 37,178 job cuts.
But the bad news is that the pharma industry still leads all others in 2010 layoffs, cutting 25,857 jobs through the end of February. This two-month total is down slightly from the same period a year ago, when the industry announced 30,869 job cuts.
The cuts come as some of the industry's biggest players--Pfizer, Wyeth, Merck, Schering-Plough, and Roche--integrate the major buyouts they made in 2009. In order to squeeze out the most efficiency from a mega-merger, these companies must cut headcount to reduce overall costs. It's an ongoing process that will continue to impact the industry's job cuts levels.
Though layoff numbers remain high for the industry, CG&C doesn't necessarily see this process as a bad thing. "What is most promising about these recent cuts is that they are being made to put the company in the best position to take advantage of future growth opportunities," says John Challenger, CEO of the firm. "Twelve months ago, cuts were being made simply to keep the company afloat. The overall decline in job cuts that has occurred over the last six-to-eight months is certainly an indication of increased optimism on the part of the nation's employers.... [W]e expect more cuts from mergers and acquisitions or from companies shifting focus from one business area to another," he adds.
Not surprisingly, California and New Jersey--two pharma industry strongholds-- experienced the deepest cuts in the first two months of this year. One of the largest planned job cuts announced last month came from Merck following its acquisition of Schering-Plough. Both companies are headquartered in New Jersey.
- here's the Challenger, Gray & Christmas release
Charts courtesy of Challenger, Gray & Christmas