Report: Dot-Com Job Cuts Reach 15-Month Low
September's 2,986 dot-com job cuts brings the 2001 total to 90,781. The 2001 running total is more than double the year-end total in 2000.
Dot-com job cuts fell to 2,986 in September, the lowest level since July 2000 -- the month that marked the beginning of the dot-com job-cutting spree that has claimed more than 125,000 jobs in 15 months -- according to a report released Monday by executive placement firm Challenger, Gray & Christmas (CGC).
September job cuts decreased 39 percent from the 4,899 in August, CGC said, and were lower by 38 percent compared to September 2000, when 4,805 dot-com cuts were announced.
"The dot-com sector may be stablizing, which would account for the decline in job-cut announcements," CGC chief executive officer John A. Challenger said. "Many of the weakest firms no longer exist, and those once considered the titans of the Internet are trimming payroll and other costs to the bare minimum."
July 2000, which saw 2,194 jobs lost, is the month when the dot-com job cuts really started to mount, according to CGC. From July 2000 to September 2001, 126,898 job cuts were announced by dot-coms.
September's 2,986 figure brings the 2001 total to 90,781 - with three months to go before year-end. The 2001 running total is 119 percent more than the year-end total from 2000, when 41,515 dot-com jobs were eliminated.
The total through September 2001 is also 457 percent more than the nine-month total in 2000 of 16,289.
"The Internet still offers viable business opportunities as the number of people with Internet access increases," Challenger said. "As a result, we will continue to see job growth in this area, but it probably will never again match the explosive growth of a couple years ago."
Dot-coms offering consumer services experienced the highest number of job cuts in September with 1,153, or 39 percent of all cuts during the month.
Portals -- which were defined as firms that design and manage sites and serve as the starting points for Web surfers -- ranked second with 790 announced job cuts.
"As in the old economy, the businesses that survive the idea stage are going to have to prove that there is a need for their service, that the service works and that it will eventually make a profit," Challenger said. "For a while, it seemed all that was needed was an innovative idea, no matter how far-fetched it was, and investors and employees would flock to you."