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Economy in Brief

U.S. Mass Layoffs Recover M/M And Are Up By Nearly One-Half From Last Year
by Tom Moeller September 24, 2009

The U.S. Labor Department reports figures covering mass layoffs which involve at least 50 initial claimants from a single establishment filing during a consecutive 5-week period. They include short-term layoffs of 30 days or fewer. During August, these layoffs recouped most of their July decline and were up by nearly one-half from the year earlier level. The series is most relevant because during the last ten years there has been a (negative) 82% correlation between layoffs and the m/m change in payroll employment.

Layoffs in private industries were quite significant last month and totaled 2,428, up 39.9% from last August. The jump from July very much reflected 900 layoff events (SA) in the factory sector. Though they were up significantly from last year they have fallen sharply from their 2009 peak. Layoffs in the machinery, transportation equipment, computer & electronics, electrical equipment, furniture industries were notable.

Mass layoffs in the construction industry followed next and there were 160 of them. While down slightly from July, they remained up by 12.7% from last August after increases of roughly one-quarter during the prior two years. In the service sector mass layoffs have become fewer in number, as reflected in the monthly reports on nonfarm payrolls. Layoffs have fallen y/y in the retail trade, information, real estate, professional & technical and the arts & entertainment industries.

Meanwhile, layoffs by in the government sector have risen by one-third y/y led by a three-quarters increase in the Federal sector and an increase of nearly one-half by state governments. Local governments have increased layoffs by a lesser 18% y/y.

The Mass layoff data are available in Haver's SURVEYS database.

Federal Reserve Transparency is today's House testimony Scott G. Alvarez, General Counsel, and it is available here

Mass Layoff Events  August July August '09 2008 2007 2006 
Total, All Industries (SA) 2,690 2,157 1,887 22,016 15,495 13,890
  Private Nonfarm 2,428 1,928 1,735 20,258 14,115 12,478
     Manufacturing 900 621 626 7,174 4,789 4,283
  Private Nonfarm (NSA) 1,334 2,659 1,343 19,432 14,046 12,587
     Construction 160 170 142 2,393 1,952 1,546
     Retail Trade 111 161 142 1,457 1,048 991
     Information 46 90 48 545 383 350
     Finance & Insurance 47 84 45 552 510 310
     Real Estate, Rental & Leasing 7 12 13 118 71 --
     Professional & Technical Services 32 95 45 564 420 352
     Health Care & Social Assistance 31 101 35 580 450 415
     Arts, Entertainment & Recreation 19 38 18 311 240 245
  Government 72 302 54 1,007 779 760

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