Dot-com layoffs plummet to lowest level of year

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Chicago--There were 4,899 dot-com job cuts this month, the lowest for any month this year, and 44% less than in July, when 8,697 layoffs were announced, according to Challenger, Gray & Christmas Inc., an outplacement firm. It is the lowest monthly amount of dot-com job cuts since August 2000, when 4,193 positions were cut. While the figures could be construed positively as a sign of a stabilizing economy-or even, perhaps, a turnaround-Challenger, Gray takes a grimmer view. "The decline in job cuts may not necessarily be an indication of an imminent turnaround," said John Challenger, CEO. "It is more likely that dot-coms are running out of employees to cut." Twenty-one dot-com companies shut down this month, compared with nine last month. Challenger, Gray couldn't provide closing totals for August 2000. Eleven of the companies that closed this month developed servers, networking devices and telecom services and equipment. "Internet technology firms are likely to see some of the heaviest job cutting, since these firms provide the support system for all other Internet firms," John Challenger said. It is a telling contrast to last year, when most companies that shuttered dealt in content. Most dot-com job cuts this month occurred at portal companies, which eliminated 1,700 positions. Coming in second were technology companies, with 1,117 layoffs. Financial services companies slashed 428 jobs and media companies cut 404 positions. Since January, dot-coms have announced 87,795 job cuts, more than double the 41,515 cuts announced in all of 2000, according to Challenger, Gray.The firm noted that many cuts today are coming from large Internet companies. AOL Time Warner Inc. announced 1,200 job cuts this month, and Fujitsu Ltd. said it would axe 16,400 positions.

--Philip B. Clark

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