Newspaper article THE JOURNAL RECORD

Round of Corporate Cutbacks Obscures Job Growth

Newspaper article THE JOURNAL RECORD

Round of Corporate Cutbacks Obscures Job Growth

Article excerpt

Farrell Kramer

Associated Press

NEW YORK _ Four sizable U.S. companies, led by Martin Marietta Corp. and USAir Group Inc., announce within hours job cutbacks that will reduce their payrolls by almost 16,000 positions.

The initial reaction is anxiety. More jobless Americans. More families suffering. More of the same distressing reports that have kept consumers on edge and businesses wary since the recession began in mid-1990.

That's the easy part. On the other hand, Thursday's bad news has the power to obscure the positive.

Since the recession ended in March 1991, the U.S. economy has created about 2 million more jobs than it's lost, excluding agricultural work. Relentless downsizing has made American industry more productive. Regions that compete with the United States _ continental Europe and Japan _ are well behind in the race to become more efficient.

But trying to put the layoff news in context, experts say, is akin to driving in a foreign country without a road map. Job losses usually reflect a broader economic downturn, and previous recoveries have been accompanied by big gains in employment.

"There's not really a historic parallel," said Richard Stuckey, chief economist at DuPont Co.

Still, the staccato burst of cutback announcements focused attention on fragile nature of job security in the United States. On Thursday: Martin Marietta, a defense contractor, said it will cut 9,000 jobs this year, of which 7,500 have been slashed already. It will cut 2,000 more by the end of 1994. USAir said it will cut about 2,500 jobs beginning in November and ending in the first half of next year. DuPont, the nation's leading chemical manufacturer, said it will cut nearly 1,200 jobs in Europe in a restructuring of its nylon business. Chemical Waste Management Inc., a company that disposes of hazardous waste, said it will eliminate about 1,200 jobs by the end of 1994.

Announcements like these, some say, can by themselves affect the overall economy by unnerving Americans who still have jobs, making them more reluctant to borrow and spend.

"They make good grist for publicity," said Lynn Michaelis, chief economist at Weyerhaeuser Co. …

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