Dot.com job cuts soar

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NEW YORK (CNNfn) - Job cut announcements in the Internet sector hit a new monthly high in April, a leading outplacement firm reported Friday.

Internet companies announced 17,554 job cuts in April, compared with 9,533 cuts in March and only 327 dot.com cuts in April 2000, according to a report from outplacement firm Challenger, Gray & Christmas Inc.



Companies that were hoping, if not expecting to eventually shift the lion's share of their business to the Internet may be forced to consider entirely new strategies for both short term and long term.



John Challenger
CEO, Challenger, Gray & Christmas
The figure for April was higher than the previous monthly record set in January, when 12,828 dot.com cuts were announced.

The first four months of 2001 have been particularly brutal in the Internet sector, with a total of 51,564 job cuts, and the cuts are beginning to affect so-called "Old Economy" companies with an Internet presence as well as so-called "New Economy" companies.

"In the beginning of the downturn, it was primarily the companies which conducted business solely over the Internet that were having the most trouble," said Challenger chief executive officer John Challenger. "Traditional brick-and-mortar companies expanding on to the Internet seemed better able to survive.

"We now see more and more of these Old Economy-New Economy hybrids cutting their online staffs," Challenger said. "Companies that were hoping, if not expecting to eventually shift the lion's share of their business to the Internet may be forced to consider entirely new strategies for both short term and long term."
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