The cash squeeze affecting the Internet sector in the US is worsening, with dot.com firms announcing 12,828 job cuts during January, a new report has found.

The survey by employment research firm Challenger, Gray and Christmas, published this week, said there was a 23 per cent jump in redundancies at Internet companies this month, compared to December.

Challenger said it had recorded 54,343 job cuts at 610 dot.com firms since December 1999. In that period, it added, 108 companies, or 18 per cent, closed down.

The report noted that while job cuts were initially in companies selling goods and services via the Internet, recent data suggest that firms involved in Internet technology and in providing professional services are also suffering.

"While early dot.com job cuts were dominated by companies selling goods and services via the Internet, recent data suggest the companies that build and maintain the technological elements of the Internet as well as firms providing professional services are being hit the hardest," said the report.