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Tickers in this Article: CFC, C, MS, LEH, F, GM, MSFT, YHOO, GOOG, S, ERIC, ALU, DELL
The market shrugged off a recent report from the Labor Department showing a huge jump in the number of new jobless claims last week, but if the rising number of corporate "restructuring" plans is any indication, the market won't be able to keep its head buried for long.

According to the Labor Department, the number of workers filing for jobless aid in the week ending January 26, rose 69,000 to 375,000 from 306,000 the previous week. This is the biggest jump since September 2005, yet many forecasting economists felt the dismal numbers were skewed by year-end "noise" in the data, as reported by Reuters. While such an explanation might be debatable, there can be no denying the fact that corporations are slashing jobs these days - a lot of jobs. Let's have a look at some of the sectors and companies that are worst hit:

Subprime Fallout

By far the worst casualty of the subprime meltdown has been the financial sector. Countrywide Financial Corp (NYSE:CFC), which stands virtually at ground zero of the subprime mess, has said it would cut up to 12,000 jobs. Among the other white-collar casualties are Citigroup (NYSE:C), which announced 4,200 job cuts in addition to 17,000 announced last April 2007, Morgan Stanley (NYSE:MS) which is expected to shed more than 1,000 jobs and Lehman Brothers (NYSE:LEH), which is laying off 140 people from the fixed-income side of its business in addition to the 1,300 it is letting go from its mortgage division. (For in-depth coverage of the crisis, see our feature on the Subprime Mortgage Meltdown.)

Heartland Still Hurting
Meanwhile, the situation in America's industrial heartland shows no sign of turning around anytime soon. According to a recent Wall Street Journal report, Ford (NYSE:F) is set to announce up to 13,000 new job cuts following an agreement with the United Auto Workers. This latest round of cuts would be on top of the 44,000 jobs Ford has lost since early 2006. Last year, General Motors (NYSE:GM) announced that it would close nine North American plants and eliminate 30,000 jobs over three years.

Tech and Telcos In Trouble

While the news that Microsoft (Nasdaq:MSFT) is bidding $31 a share for Yahoo (Nasdaq:YHOO) may be good news for Yahoo shareholders, it's probably sealed the fate of an estimated 1,500 to 2,500 Yahoo employees rumored to be facing the ax as the company struggles to reposition itself in the face of tough competition from Google (Nasdaq:GOOG). Meanwhile another tech stock, PC-maker Dell (Nasdaq:DELL), announced on January 31 that it is closing a call center in Edmonton, Alberta, Canada, putting 900 people out of work.

Over on the telecom side, the No.3 U.S. mobile service provider, Sprint Nextel (NYSE:S), said it would cut about 4,000 jobs and close 125 stores. Tough times in the mobile communications industry in the U.S. also seem to be spreading overseas. Swedish telecom giant Ericsson (Nasdaq:ERIC) just announced that it would cut about 1,000 jobs in its home market and some 4,000 jobs globally. France's Alcatel-Lucent (NYSE:ALU) announced 400 more jobs would be gone bringing the total losses in that country to 1,868 since Alcatel acquired Lucent in December 2006. Last October, the company announced it would cut 16,500 jobs overall, or 4,000 more than planned.

The Bottom Line
If government statistics are too "noisy" to get a good reading on the job situation, its worth tracking the corporate job-cut announcements that are hitting the headlines with increasing frequency these days. The employment situation is everything at this point. Should things really start unraveling on the job front, then the recovery in sentiment brought on by the Fed's rate cuts that has prompted this rally will evaporate like so much morning fog.

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