Thursday, September 22, 2011

Mass layoffs down 28 percent in 2011

Mass layoff events fell 28 percent to 68 events during the first eight months of 2011 in Colorado. There were 95 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 6 mass layoff events during August 2011, which is up 20 percent from the 5 events reported during August 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 decreased 1.5 percent from 976 during August 2010 to 961 during August of this year.

In the year-to-date total for August, mass layoffs have now fallen two years in a row after peaking at 117 mass layoffs during the eight months of 2009. The second graph shows year-to-date totals for August 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 and August 2011 showed the first year-over-year growth in employment in 34 months.

New jobless claims

New claims for unemployment insurance rose year over year in by 54 percent to 547 in August 2011. There were 355 new claims during August of last year. New claims for unemployment insurance have also gradually fallen since early 2010. Nationally, new claimants rose 7.3 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. Nevertheless, new claimants totals increased both nationally and in Colorado during August. August is typically a light month for initial claims, but Colorado's total was up considerably.



In year-to-date totals for new unemployment claims through August, totals are down 23 percent year over year. There were 6,946 new claims during the first eight months of 2011, compared to 9,070 new claims during the same period last year. In the year-to-date total for August, new claims for unemployment insurance have now fallen two years in a row after peaking at 10,829 claims during the first eight months of 2009. The last graph shows year-to-date totals for August 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 157,000 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 223,000 unemployed workers in Colorado.)