Mass Layoffs Spike in Second Quarter

August 20, 2003 (PLANSPONSOR.com) - The number of second-quarter extended mass layoffs and the workers involved both spiked over data from the previous three-month period, but showed a decline from the same period a year earlier.

According to the regular report from the US Department of Labor’s Bureau of Labor Statistics (BLS), companies undertook 1,894 mass layoffs during the second quarter of at least 31 days covering 372,426 workers (up 25.5% from the first quarter’s 1,508 layoffs and up 36.8% in the number of employees covered).

BLS said figures from the second quarter trailed those for second quarter 2002 while first-half 2003 numbers (3,594 layoffs covering 705,686 workers) also trailed the data from the first half of 2002.

BLS said the decline from second quarter 2002 was most notable in professional and technical services, agriculture and forestry support activities, and crop production. BLS gathers the data from initial unemployment insurance claims and defines extended mass layoffs as those involving 50 or more employees from the same company out of work for more than 30 days.

The completion of seasonal work represented a third of all second-quarter mass layoff events and 130,991 workers during the period.   Layoffs due to internal company restructuring represented 20% of events and resulted in 82,516 separations, both somewhat lower than a year earlier.   Permanent closure of worksites occurred in 14% of all layoffs and affected 59,990 workers. A year earlier, such closures occurred in 15% of all events and affected 71,229 workers.   Some 47% of employers with layoffs in the second quarter indicated that they anticipated some type of recall, lower than a year ago (53%).

     

A Third of Layoffs from Manufacturing

Second quarter extended mass layoffs occurred in 459 of the 1,197 detailed industries for which data are available.   Manufacturing industries accounted for 30% of private-sector layoff events and 28% of separations during April to June 2003.   The 92,266 worker separations were lower than second quarter 2002.   Layoff activity in this sector was concentrated in food manufacturing (16,751, largely in the highly seasonal fruit and vegetable canning industry), followed by transportation equipment (15,639, mainly in aircraft and in automobile manufacturing) and computer and electronic product manufacturing (10,409, mostly in semiconductors and related devices).  

Layoffs in government establishments accounted for 9% of all events and 12% of separations, matching the highest share of separations since the program began in second quarter 1995.   Layoffs in the government sector were primarily concentrated in educational services, as the school year ended.

     

Second-quarter layoffs continued to be concentrated at the lower end of the extended layoff-size spectrum, with 62% involving fewer than 150 workers.   These events, however, accounted for only 28% of all separations. Separations involving 500 or more workers accounted for 34% of all layoffs, down from 40% a year earlier.  

  

Of those applying for initial uninsurance during the second quarter, 17% were black, 51% were women, 15% were Hispanic, and 17% were 55 years of age or older.  

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