Tuesday, August 23, 2011

Mass layoffs in 2011 down 31 percent

Mass layoff events fell 31 percent to 62 events during the first seven months of 2011 in Colorado. There were 90 mass layoff events during the same period last year. According to a new report released today by the U.S. Bureau of Labor Statistics, there were 8 mass layoff events during July 2011, which is down 50 percent from the 16 events reported during July of last year.

Monthly mass layoff events grew rapidly after October 2008 in Colorado, and have gradually lessened since early 2010.



Nationally, mass layoff events increased 2.4 percent from 2,124 during July 2010 to 2,176 during July of this year.

In the year-to-date total for July, mass layoffs have now fallen two years in a row after peaking at 112 mass layoffs during the first seven months of 2009. The second graph shows year-to-date totals for July since 2001:



Mass layoffs were rare from 2004 through most of 2008.

Overall, the most recent mass layoffs data suggests that the employment situation continues to stabilize. New layoffs continue to lessen, and as we've seen in the most recent employment data, July showed the first year-over-year growth in employment in 34 months.

New jobless claims

New claims for unemployment insurance fell year over year in July by 54 percent to 704 in July 2011. There were 1,552 new claims during July of last year. New claims for unemployment insurance have also gradually fallen since early 2010. Nationally, new claimants rose 5.1 percent during the same period.

As can be seen in the third graph, year-over-year changes in new unemployment claims points toward more and more stability in the labor markets as most year-over-year changes has been below zero since late 2009. Colorado's total of new claimants fell, while the total increased at the national level.



In year-to-date totals for new unemployment claims through July, totals are down 26 percent year over year. There were 6,399 new claims during the first seven months of 2011, compared to 8.715 new claims during the same period last year. In the year-to-date total for July, new claims for unemployment insurance have now fallen two years in a row after peaking at 10,455 claims during the first seven months of 2009. The last graph shows year-to-date totals for July since 2001:



Analysis
The year-over-year comparisons clearly show that both new claims and mass layoffs are down from both 2009 and 2010 so far this year. However,total employment in Colorado is still 161,000 jobs below peak levels. New layoffs and new unemployment claims continue to fall, but there is little job creation going on at the same time to provide for re-entry into the workforce. The fact that recent first-time claimants are such a small portion of the total number of jobless persons suggests that many of those people who are unemployed have been unemployed for an extended period of time. (The most recent Colorado employment data states that there are 230,147 unemployed workers in Colorado.)