Technical information: (202) 691-6392 USDL 08-1669
http://www.bls.gov/mls/
For release: 10:00 A.M. (EST)
Media contact: (202) 691-5902 Thursday, November 13, 2008
EXTENDED MASS LAYOFFS IN THE THIRD QUARTER OF 2008
In the third quarter of 2008, employers initiated 1,330 mass layoff
events that resulted in the separation of 218,158 workers from their
jobs for at least 31 days, according to preliminary figures released
by the U.S. Department of Labor's Bureau of Labor Statistics. Layoff
events reached their highest level for the third quarter since 2001,
while separations reached their highest level since 2003. The total
number of layoff events was 312 higher in the third quarter 2008 than
the same period a year earlier, and the number of associated
separations increased by 58,134. (See table A.) Third quarter 2008
layoff data are preliminary and are subject to revision. (See the
Technical Note.)
Both events and separations in the construction industry reached
third quarter program highs in 2008. The number of separations in
manufacturing rose sharply (+32,175) over the year, largely due to
increased layoff activity in the transportation equipment sector
(+12,930).
Among the seven categories of economic reasons for layoff, business
demand accounted for the highest share of events (43 percent) and
number of separations (76,979) in July-September 2008. (See table B.)
The largest over-the-year increases in the number of separations
occurred in layoffs attributed to business demand factors (+27,711)
and organizational changes (+10,533). Within business demand, the
number of separations due to slack work nearly doubled to 41,116,
while in organizational changes, layoffs attributed to business-
ownership changes more than doubled to 11,692. Within financial
issues, the number of workers terminated because of bankruptcies
nearly doubled over the year to 12,156.
Permanent closure of worksites occurred in 15 percent of all
extended mass layoff events and affected 50,025 workers during the
third quarter of 2008. Thirty-one percent of employers reporting a
layoff indicated they anticipate some type of recall, down from 38
percent a year earlier and the lowest third quarter proportion since
2002. Excluding seasonal events, employers anticipated recalling
workers in 20 percent of the layoffs, matching third quarter 2002 as
the lowest proportion for any quarter since data collection began in
1995.
The national unemployment rate averaged 6.0 percent, not seasonally
adjusted, in the third quarter of 2008, up from 4.7 percent a year
earlier. Private nonfarm payroll employment, not seasonally adjusted,
decreased by 0.6 percent (-672,000) over the year.
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Table A. Selected measures of extended mass layoff activity
Period Layoff events Separations Initial claimants
2004
January-March .......... 1,339 276,503 238,392
April-June ............. 1,358 278,831 254,063
July-September ......... 886 164,608 148,575
October-December ....... 1,427 273,967 262,049
2005
January-March .......... 1,142 186,506 185,486
April-June ............. 1,203 246,099 212,673
July-September ......... 1,136 201,878 190,186
October-December ....... 1,400 250,178 246,188
2006
January-March .......... 963 183,089 193,510
April-June ............. 1,353 295,964 264,927
July-September ......... 929 160,254 161,764
October-December ....... 1,640 296,662 330,954
2007
January-March .......... 1,110 225,600 199,250
April-June ............. 1,421 278,719 259,234
July-September ......... 1,018 160,024 173,077
October-December(r) .... 1,814 301,592 347,149
2008
January-March(r) ....... 1,340 229,858 258,767
April-June(r) .......... 1,756 354,361 335,854
July-September(p) ...... 1,330 218,158 181,386
r = revised.
p = preliminary.
Industry Distribution of Extended Layoffs
Manufacturing industries were responsible for 32 percent of private
nonfarm extended layoff events and 35 percent of related separations
in the third quarter of 2008; a year earlier, manufacturing made up 26
percent of events and 27 percent of separations. (See table 1.) Manu-
facturing had 430 extended mass layoff events and 75,511 separations,
the highest third quarter levels for the industry since 2003. The
largest numbers of separations were in transportation equipment manu-
facturing (21,630, mostly associated with light truck and utility
vehicle manufacturing) and food manufacturing (10,975).
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Table B. Distribution of extended layoff events and separations by
economic reason categories, July-September 2008(p)
Category Layoff events Separations
Number Percent Number Percent
Total .................. 1,330 100.0 218,158 100.0
Business demand ............. 577 43.4 76,979 35.3
Organizational changes ...... 107 8.0 28,256 13.0
Financial issues ............ 174 13.1 32,812 15.0
Production specific ......... 23 1.7 3,527 1.6
Disaster/safety ............. 5 0.4 1,362 0.6
Seasonal .................... 198 14.9 38,742 17.8
Other/miscellaneous ......... 246 18.5 36,480 16.7
p = preliminary.
The construction sector accounted for 16 percent of events and 10
percent of separations, the highest third quarter percentages recorded
in the program. These job cuts were largely in specialty trade con-
tracting. Layoffs in administrative and waste services accounted for
9 percent of all events and separations and were concentrated in tem-
porary help services.
Reasons for Extended Layoffs
Among the seven categories of economic reasons for extended mass
layoffs, events related to business demand factors (contract cancel-
lation, contract completion, domestic competition, excess inventory,
import competition, and slack work) accounted for 43 percent of the
extended layoffs and 35 percent of separations during the third quar-
ter of 2008. (See table 2.) Separations in this category registered
the largest over-the-year increase (+27,711), with those related to
slack work/insufficient demand/nonseasonal business slowdown nearly
doubling. The numbers of workers terminated because of business de-
mand reasons were highest in temporary help services, light truck and
utility vehicle manufacturing, and professional employer organizations.
Seasonal factors (seasonal and vacation period) made up 15 percent
of the extended layoff events and resulted in 38,742 separations, pri-
marily in school and employee bus transportation and in food service
contracting.
Job losses related to financial issues (bankruptcy, cost control,
and financial difficulty) accounted for 13 percent of events and
resulted in 32,812 separations during the third quarter of 2008,
compared with 28,461 separations a year earlier. This increase was
largely due to bankruptcies in full service restaurants.
Movement of Work
In the third quarter of 2008, 82 extended mass layoffs involved the
movement of work and were associated with 14,613 separated workers.
(See table C.) These movements of work were to other domestic
locations or to locations outside of the U.S., and they occurred
either within the same company or to other companies. Movement of
work layoffs accounted for 7 percent of nonseasonal layoff events
in the third quarter of 2008. A year earlier, there were 63 layoff
events and 12,367 separations associated with the movement of work.
(See table 10.)
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Table C. Extended mass layoff events and separations, selected measures,
third quarter 2008(p)
Action Layoff events Separations
Total, private nonfarm ................ 1,330 218,158
Total, excluding seasonal and
vacation events(1) ................ 1,132 179,416
Total events with movement
of work(2) .................... 82 14,613
Movement of work actions ...... 104 (3)
With separations reported .. 76 9,265
With separations unknown ... 28 (3)
1 The questions on movement of work were not asked of employers when the
reason for layoff was either seasonal work or vacation period.
2 A layoff event can involve more than one movement of work action.
3 Data are not available.
p = preliminary.
Among the 82 extended mass layoff events with reported relocation
of work in the third quarter of 2008, 55 percent were permanent clo-
sures of worksites, which affected 9,873 workers. In comparison,
15 percent of the total extended mass layoff events reported for the
quarter involved the permanent closure of worksites affecting 50,025
workers.
Of the layoffs involving the movement of work, 67 percent of the
events and 75 percent of the laid-off workers were from manufacturing
industries during the third quarter. (See table 7.) Among all pri-
vate nonfarm extended layoffs, manufacturing accounted for 32 percent
of the events and 35 percent of separations.
While only 8 percent of the extended mass layoff events in the
total private nonfarm economy were because of organizational change,
such reasons accounted for 56 percent of layoff events associated with
work relocation and resulted in 8,276 separations during the third
quarter. (See table 8.)
Among the regions, the Midwest accounted for the largest proportion
of workers affected by extended mass layoffs associated with the move-
ment of work (56 percent), followed by the Northeast and the West
(15 percent each), and the South (13 percent). (See table 9.)
Some extended mass layoff events involve more than one relocation
of work action. For example, an extended mass layoff event at an
employer may involve job loss due to movement of work to both another
domestic location of the company and a location out of the country.
This would be counted as two movement of work actions. The 82 ex-
tended layoff events with movement of work for the third quarter of
2008 involved 104 identifiable relocations of work. (See table C.)
An identifiable relocation of work occurs when the employer provides
sufficient information on the new location of work and/or the number
of workers affected by the movement. Of the 104 relocations, employers
were able to provide information on the specific number of separations
associated with the movement of work component of the layoff in 76
actions involving 9,265 workers. (See table 10.)
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Table D. Movement of work actions by type of separation where the
number of separations is known by employers, third quarter 2008(p)
Activities Actions (1) Separations
With separations reported ..... 76 9,265
By location
Out-of-country relocations .. 19 2,211
Within company ........... 17 2,034
Different company ........ 2 177
Domestic relocations ........ 57 7,054
Within company ........... 48 6,257
Different company ........ 9 797
By company
Within company .............. 65 8,291
Domestic ................. 48 6,257
Out of country ........... 17 2,034
Different company ........... 11 974
Domestic ................. 9 797
Out of country ........... 2 177
1 Only actions for which separations associated with the
movement of work were reported are shown.
p = preliminary.
In the 76 actions where employers were able to provide more complete
separations information, 86 percent of relocations (65 out of 76) occurred
within the same company. (See table D.) Seventy-five percent of reloca-
tions (57 out of 76) were domestic reassignments, while 25 percent (19 out
of 76) involved out-of-country moves. Domestic relocation of work--both
within the company and to other companies--affected 7,054 workers. Out-of-
country relocations were associated with the separation of 2,211 workers,
1 percent of all nonseasonal and nonvacation extended mass layoff separa-
tions. (See table 11.)
Recall Expectations
Thirty-one percent of employers reporting an extended layoff in the
third quarter of 2008 indicated they anticipated some type of recall,
down from 38 percent a year earlier and the lowest third quarter propor-
tion since 2002. (See table E.) Of those employers expecting to recall
workers, 38 percent indicated that the offer would be extended to all
displaced employees, and 79 percent of employers anticipated extending
the offer to at least half of the workers. Seventy-two percent of em-
ployers expecting to recall laid-off employees intend to do so within
6 months.
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Table E. Summary of employer expectations of a recall from extended
layoff, third quarter 2007-third quarter 2008
Percentage of events
Nature of the recall III IV I II III
2007 2007 2008 2008(r) 2008(p)
Anticipate a recall ........ 37.9 55.8 40.1 51.1 30.5
Timeframe
Within 6 months ........ 83.9 87.9 69.8 84.5 71.9
Within 3 months ..... 62.7 34.2 45.4 59.1 54.9
Size
At least half .......... 86.0 90.5 73.2 88.3 79.1
All workers ......... 45.6 50.5 28.5 51.7 37.9
r = revised.
p = preliminary.
Excluding layoff events due to seasonal work and vacation period (in
which 93 percent of the employers expected a recall), employers antici-
pated recalling laid-off workers in 20 percent of the events, matching
third quarter 2002 as the lowest proportion since the program began in
1995.
Size of Extended Layoffs
The average size of a layoff (as measured by separations per layoff
event) in the third quarter of 2008 was 164, compared to 157 per layoff
in third quarter 2007. Layoff events continued to be concentrated at
the lower end of the extended layoff-size spectrum, with 48 percent of
events involving between 50 and 99 workers and 71 percent of events with
less than 150 workers.
Layoffs involving less than 150 workers accounted for 37 percent of all
separations during the period, about the same percentage recorded a year
earlier (38 percent). Separations involving 500 or more workers, while
comprising only 4 percent of the events, accounted for 28 percent of all
separations in the third quarter of 2008, up from 24 percent a year earlier.
(See table F.)
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Table F. Distribution of extended layoff events by size of layoff, third
quarter 2008(p)
Layoff events Separations
Size
Number Percent Number Percent
Total ................. 1,330 100.0 218,158 100.0
50-99 ............... 639 48.0 44,934 20.6
100-149 ............. 311 23.4 36,314 16.6
150-199 ............. 122 9.2 20,675 9.5
200-299 ............. 124 9.3 28,034 12.9
300-499 ............. 76 5.7 27,640 12.7
500-999 ............. 38 2.9 24,955 11.4
1,000 or more ....... 20 1.5 35,606 16.3
p = preliminary.
Initial Claimant Characteristics
A total of 181,386 initial claimants for unemployment insurance were
associated with extended mass layoffs in the third quarter of 2008. Of
these claimants, 16 percent were black, 18 percent were Hispanic, 40 per-
cent were women, 34 percent were 30 to 44 years of age, and 18 percent
were 55 years of age or older. (See table 3.) Among persons in the civi-
lian labor force for the same period, 12 percent were black, 14 percent were
Hispanic, 46 percent were women, 33 percent were age 30 to 44, and 18 percent
were 55 years of age or older.
Geographic Distribution
Among the 4 census regions, the West recorded the highest number of se-
parations (78,277) due to extended mass layoff events in the third quarter
of 2008, followed by the Midwest, with 53,265. (See table 4.) Separations
in the West occurred largely in specialty trade contracting and in food manu-
facturing. The West accounted for 36 percent of all separations, up from
33 percent in the same period last year.
Among the 9 census divisions, the highest number of separations during the
third quarter of 2008 was in the Pacific division (70,079). The East North
Central division had the next-highest level of separations, with 44,284.
(See table 4.)
California recorded the largest number of worker separations (61,375),
followed by Florida (20,261), Illinois (17,552), and New York (14,310).
(See table 5.) After excluding the impact of seasonal reasons, California
still reported the highest number of job cuts (57,116).
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Table G. Mass layoff events and separations, selected metropolitan areas
Events Separations
Metropolitan area III III III III
2007(r) 2008(p) 2007(r) 2008(p)
Total, nonmetropolitan areas .................. 109 127 15,319 17,564
Total, 369 metropolitan areas ................. 524 670 78,211 101,362
Los Angeles-Long Beach-Santa Ana, Calif. .. 81 87 10,304 11,187
New York-Northern New Jersey-Long Island,
N.Y.-N.J.-Pa. .......................... 61 49 14,397 11,140
Chicago-Naperville-Joliet, Ill.-Ind.-Wis. . 28 46 4,849 8,923
San Jose-Sunnyvale-Santa Clara, Calif. .... 11 26 1,106 3,700
San Francisco-Oakland-Fremont, Calif. ..... 20 29 1,913 3,536
Las Vegas-Paradise, Nev. .................. (1) 20 (1) 3,101
Elkhart-Goshen, Ind. ...................... 3 11 243 2,434
San Diego-Carlsbad-San Marcos, Calif. ..... 23 19 2,753 2,234
Miami-Fort Lauderdale-Pompano Beach, Fla. . 5 12 492 2,022
Modesto, Calif. ........................... 5 5 436 2,017
1 Data do not meet BLS or state agency disclosure standards.
r = revised.
p = preliminary.
NOTE: The geographic boundaries of the metropolitan areas shown in this table
are defined in Office of Management and Budget Bulletin 08-01, November 20, 2007.
California accounted for 28 percent of all separations due to extended
mass layoffs in the third quarter 2008, up from 26 percent in 2007. Florida
accounted for 9 percent of the separations, up from 5 percent last year. In
2008, four states reported third quarter program highs in terms of numbers of
separations--Indiana, Oklahoma, South Carolina, and Wyoming.
Fifty percent of extended mass layoff events and 46 percent of separations
(101,362) occurred in metropolitan areas in the third quarter of 2008, compared
with 51 percent of events and 49 percent of separations (78,211) during the third
quarter of 2007. Among the 369 metropolitan areas, Los Angeles-Long Beach-Santa
Ana, Calif., reported the highest number of separations (11,187) in the third
quarter of 2008. Next were New York-Northern New Jersey-Long Island, N.Y.-N.J.-
Pa., with 11,140 separations and Chicago-Naperville-Joliet, Ill.-Ind.-Wis., with
8,923 separations. (See table G.) Employers located in nonmetropolitan areas
separated 17,564 workers in extended mass layoffs.
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Note
The quarterly series on extended mass layoffs cover layoffs of at least 31-
days duration that involve 50 or more individuals from a single employer filing
initial claims for unemployment insurance during a consecutive 5-week period.
Approximately 30 days after a mass layoff is triggered, the employer is con-
tacted for additional information. Data for the third quarter are preliminary
and subject to revision. This release also includes revised data for previous
quarters. Data are not seasonally adjusted, but survey data suggest that there
is a seasonal pattern to layoffs. Thus, comparisons between consecutive quar-
ters should not be used as an indicator of trend.
For additional information about the program, see the Technical Note.
________________
The report on Mass Layoffs in October 2008 is scheduled to be released on
Friday, November 21.
Bureau of Labor Statistics
