“The key thing was our CEO, Ed Colligan, had the insight that once the [BlackBerry] Pearl came out, the smart-phone business was going to be a consumer business, and Palm was not positioned for that and needed a major transformation, and that’s what we got involved in doing. The whole notion was you wanted to take that cultural legacy of innovation that created the Pilot and the Treo and then apply it to the next customer.”

–Roger McNamee lauds Palm CEO Ed Colligan at our recent D: All Things Digital conference

Now we know why it was Palm executive chairman Jon Rubinstein and investor Roger McNamee on stage at D last month talking up the Pre, and not CEO Ed Colligan: Colligan was on his way out.

On Wednesday, Palm (PALM) named Rubinstein as its new chairman and CEO. Come Friday he’ll succeed Colligan, who is leaving the company after 16 years to join McNamee at Elevation Partners. Apparently Palm, who recruited Rubinstein, a former Apple (AAPL) engineer, to turn the company around has decided it would much rather have him in its highest office than Colligan under whose leadership it was foundering.

In a statement, Rubinstein–who has spent the past two years quarterbacking the development of the Pre and its webOS–welcomed his new role. “I am very excited about taking on this expanded role at Palm,” he said. “Ed and I have worked very hard together the past two years, and I’m grateful to him for everything he’s done to help set the company up for success. With Palm webOS we have ten-plus years of innovation ahead of us, and the Palm Pre is already one of the year’s hottest new products. Due in no small part to Ed’s courageous leadership, we’re in great shape to get Palm back to continuous growth, and we plan to keep the trajectory going upward.”

Reached for comment late Wednesday afternoon, Roger McNamee offered up this rather canned statement on Palm’s leadership transition: “With Ed’s decision to step down, Jon Rubinstein is the natural choice to lead Palm into its next phase of growth. Jon has proven to have exactly the right mix of product vision, organizational leadership and operational capabilities to help Palm regain a leadership position. We are grateful for the leadership role Ed has played in initiating this transformation and getting through the successful launch of webOS and the Pre.”

Palm shares are up 3.75 percent at $12.44 on the news.

Great news, right? Until you realize that the “planned reductions” to which the company refers were up 47 percent from a year earlier and are still at recession levels. So while this is the third consecutive month in which layoffs declined, the job market is still in lousy shape.

Employers have sacked 711,100 employees so far this year. That’s 145 percent percent more than the 290,671 they cut in the first quarter of 2008. Keep in mind, this is “planned layoffs” we’re talking about. Presumably there were some unplanned ones as well.

“Job cuts are still at recession levels, but the fact that they are falling is certainly promising and may suggest that employers are starting to feel a little more confident about future business conditions,” said Challenger CEO John Challenger. “Hopefully, the next few months will bring further relief, as we tend to see downsizing activity slow during the summer months.”

Yeah, “hopefully.” But don’t count on it. Because Federal Reserve Chairman Ben Bernanke says the economy hasn’t quite bottomed out yet. Which means things may get a bit worse before they get better.

“The most recent information on the labor market–the number of new and continuing claims for unemployment insurance through late April–suggests that we are likely to see further sizable job losses and increased unemployment in coming months,” Bernanke recently told the congressional Joint Economic Committee.

Whether that is a true vote of confidence remains to be seen. Certainly, Yahoo (YHOO) made similar remarks about Jerry Yang during its ill-starred negotiations with Microsoft (MSFT), and we all know how that worked out for him…