In the last year, American corporation John Deere has laid off nearly 1,000 workers and it announced 650 job cuts on Wednesday, June 5. The manufacturing tractor company also plans to send more work to Mexico.
John Deere’s profits dropped by more than $6 billion from this time in 2023, with economists pointing to slower sales of new farm equipment due to higher interest rates.
The Bureau of Labor Statistics posted May’s job report on Friday, June 7, showing the unemployment rate inching up from 3.9% to 4%. This is the highest level since the start of 2022, with 6.6 million unemployed people.
However, 276,000 jobs were added in May — significantly higher than the 185,000 jobs analysts had predicted. According to economists, the May jobs report makes it unlikely that the Federal Reserve will reduce interest rates, as inflation remains at 3.6%, well above the preferred 2% target rate.
“And don’t forget we’re going into the summer season where things just get a little slower,” said Alexander Morris, CEO of F/M Investments. “So, I think we should expect more of this sort of behavior for the next few weeks.”
These layoffs are not just happening at John Deere. Over the last two years, several industries have announced job cuts, including technology, retail, health care, financial, automotive and media.
In 2023, job cuts soared to their highest level since the pandemic in 2020, with most happening in the first half of the year. Tech companies like Meta and Amazon announced they are slashing jobs, and the Challenger Report, which tracks job cuts, shows that tech led the country with a 73% increase in job cuts that year — just shy of the record set in 2001.
The job cuts slowed down in November and December last year, however, further reductions have picked up in the first half of 2024, though they remain lower than a year ago.
Google, Amazon, Tesla, Microsoft and Nike all announced cuts for this year.
According to a survey conducted by Resume Builder in late 2023, 4 in 10 business leaders said their companies were likely to experience layoffs this year, and 52% said a hiring freeze would likely go into effect at their companies as well.
Nearly 70% of those business leaders cited a need to reduce costs, and just over 50% said they anticipated a possible recession.
According to the Challenger Report, in April 2024, U.S. employers announced nearly 65,000 layoffs — a 28% drop from the more than 90,000 announced in March.
So, whether unemployment continues to rise or if inflation cools this summer is still too soon to tell.
