The good news about May's dot-com job cuts: They declined 24% from the previous month, to 13,419. But the rest of the story isn't so sanguine: Cuts for 2001 already total 64,983, nearly 60% more than the grand total for last year. Those are the findings of a recent report from outplacement firm Challenger, Gray & Christmas. Another figure that rose significantly: Shuttered dot-com companies more than doubled between April and May, from 13 to 29. November 2000 still holds the record, with 31 closings.
Internet technology companies--those that build and maintain Net infrastructure--bore the brunt of the cuts, with 5,860. The two runners up: consumer services at 3,462 and professional-services firms at 2,265. "Bricks-and-mortar companies that got out ahead of the curve and built Internet divisions are cutting back," says John Challenger, CEO of Challenger, Gray & Christmas. As a result, technology companies are feeling the pinch as more companies go under or decide against upgrades, he says.
Although the pace of cuts slowed, May wasn't exactly a gentle month. It wins the silver medal for highest number of dot-com cuts to date. "The pressure is still on," says Challenger. Declining job cuts certainly don't offer any guarantees, as recent history shows. Dot-com job cuts were down in March as well--18% less than February levels--before they surged 84% to April's record high of 17,554 cuts.