Election Issue 2016: America's Biggest Layoffs of the Past 25 Years

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Hewlett-Packard recently announced a 33,000-employee layoff, a reduction that represents approximately 10 percent of the company’s workforce. As the PC market has declined, HP has struggled to find a foothold in key markets like mobile and software.

Analysts suggest that the layoff—along with new offerings in cloud computing, security and data analytics—will help boost earnings while the company explores new opportunities.

But just how big is HP’s announcement compared to other famous American layoffs?

Company research site FindTheCompany turned to outplacement firm Challenger, Gray & Christmas to visualize the biggest layoffs at U.S. companies. The firm is the oldest executive outplacement organization in America and the leading aggregator of workforce reduction data.

The data includes layoff announcements from the early ‘90s through today. Note that the numbers are based on officially announced figures, not actual totals. As we’ll see below, some layoffs grow far past the initial, announced estimate.

We’ll start with the overall list, then highlight a few key charts and insights.

 

HP’s recent announcement ranks 11th on the list, and also stands as the biggest announced layoff at a tech company since 1993.

That said, HP’s 2012 layoff—which the company originally pegged at 27,000—quietly ballooned to 55,000 as the years wore on. Time will tell whether the 2015 layoff follows a similar trend.

Though HP ranks highly, IBM tops the list. The computing powerhouse dominated the ‘80s before corporate fat, rigidity and wasteful projects nearly cratered the company in the early ‘90s. Former CEO Lou Gerstner spearheaded the notoriously painful 1993 layoffs, though history suggests it was the right call. Following the reduction, the company gradually flipped from red to black—from $8 billion in losses (1993) to $8 billion in profit (2001).

Other big ‘90s layoffs include Sears (1993, when it shut down its classic catalog business) and AT&T (1996, when it split into three separate companies in a massive corporate restructuring).

Outside of the private sector, government cuts have loomed large. After several years of military expansion under former President George Bush, the Obama administration scaled back the U.S. Army by 50,000 in 2011, a reduction that now ranks as the fourth biggest layoff announcement since the early ‘90s.

Meanwhile, the United States Postal Service performed three waves of cuts, for a total of 90,000 laid-off workers since the turn of the millennium. Parcel delivery services like UPS may have found ways to benefit from technological innovation, but classic snail mail has become less relevant every year.

And then there is the 2008 financial crisis, a downturn that hit banks and automotive companies particularly hard. Citigroup and General Motors stand out among their industries as the most telltale victims.

The chart below aggregates layoffs by industry, with government, automotive and computer companies holding three of the top four spots:

 

One other victim we haven’t mentioned? Retail. With the rise of Amazon and eBay, retailers across the nation have been forced to lay off thousands of employees—most notably, Kmart (2003), Circuit City (2009), Ames Department Stores (2002) and Winn-Dixie (2005). All together, retail reductions have combined for the largest aggregate layoff count in the private sector.

For a slightly different view of the data, consider the overall company layoff ranking with separate reductions combined:

 

HP’s 2015 announcement vaults the company into the second spot, behind only the United States Postal Service.

Finally, this last chart shows the number of layoffs by year. Predictably, layoffs tend to come hand-in-hand with economic recessions, as we see reductions clumping around both 2002 and 2008.

 

Note that the data in these charts aggregates only the layoffs from the top 30 announcements, not all layoffs.

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