The Challenger Job-Cut Report provides information on the total number of announced corporate layoffs. Produced by Challenger, Gray & Christmas, this monthly report collects and categorizes announcements of corporate layoffs using mass layoff data from state departments of labor. The Challenger Job-Cut Report is commonly used by investors as an indicator to determine the strength of the labor market.
While the Challenger Job-Cut Report is useful as a leading indicator for new jobless claims, one must understand that not all layoff announcements result in job losses in the near term. The report does not distinguish between layoffs scheduled for the short-term or long-term. In a situation where job cuts are handled through attrition instead of actual layoffs, people may resign voluntarily or the company's situation may change in order to keep their employees. As a result, the report might not be able to give an accurate picture of the actual situation in the labor market.
The Challenger Job-Cut Report is categorized into different industries and geographical regions. This information provides insight into where layoffs are occurring and how likely it will affect prices of stocks in each of the industries.