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|May 19, 2019|
Layoff warnings jump: 30% more California workers targeted
If youíve been hearing rumblings of more than the usual number of layoffs statewide, your economic antenna is dialed in: The number of California workers hit with layoff warnings is up 30 percent in a year.
Californiaís Worker Adjustment and Retraining Notification Act requires employers to inform the state of planned layoffs, facility closures or relocations at least 60 days in advance. Tracking the so-called ďWARNĒ filings is not a perfect science as some warnings are just that, possibilities that arenít fulfilled. But filing trends my trusty spreadsheet unearthed do hint at how bosses are feeling about their staffing and business prospects.
In the eight months ended in February, California employers filed 509 warnings affecting 48,831 workers. Compare that with the same period in fiscal 2018, and you find 21 percent more filings hitting 30 percent more workers.
Thisís quite a reversal for bosses. Fiscal 2018ís filings were down 2 percent in a year as the number of workers hit by planned layoffs also fell by 2 percent. In 2017, filings fell 10 percent and impacted workers dropped by 13 percent.
This layoff uptick is further evidence the economy has hit a patch where success is by no means spread evenly. Those employers in tough times are making tough decisions. Itís a reason why Californiaís job growth, still an admirable 1.9 percent over the past 12 months, is at its lowest since 2012.
But another figure tied to job losses, initial unemployment claims, suggests the increases in layoffs has yet to boost the ranks of people seeking unemployment aid.
In the eight months ended in February, 326,987 initial claims for benefits were made. Not only is that down 4 percent vs. the same period a year earlier, itís also the slowest pace of claim requests since 2005.
The count of workers applying for unemployment insurance payments has consistently dropped for nine consecutive years since the end of the Great Recession, contributing to Californiaís historically low unemployment rate in the past year.
Yet how can layoff warnings be up so much while, at the same time, fewer workers are seeking jobless benefits?
For starters, it may be a case of larger employers faring worse than bosses with smaller staffs. Remember a WARN notice typically involves employers with 75 or more workers; plant closure affecting any amount of employees; layoffs of 50 or more employees or a 100-mile-plus relocation. A huge chunk of Californians works at more modest-sized businesses.
Secondly, and perhaps more importantly, this divergence may speak volumes about the current worker shortage. Itís a good possibility that employees served a layoff notice can get new employment quickly, eliminating the need to seek unemployment relief, or they have severance to tide them over between jobs.
Still, rising layoff notices cannot be ignored. Just look at some recent layoff notices and the broad economic spectrum they cover, 1,024 at carmaker Tesla around Northern California; 551 at a Kern County agricultural firm; 313 at tech firm Western Digitalís San Jose and Irvine offices; and 183 at a Crocs warehouse facility in Ontario. Business challenges are out there.
Yes, perhaps the planned layoff surge is simply a modest blip in a long-running hiring spree by California employers. And so far, plenty of bosses have been able to fill their openings with workers let go elsewhere. (Source: The Mercury News)
Story Date: March 17, 2019