April 19, 2024

7:09 am ET, February 2, 2024

What’s the deal with all the recent layoffs?

An empty office space at a building in San Francisco, California on December 5, 2023. David Paul Morris/Bloomberg/Getty Images Mass layoffs at tech, media and transportation firms have been in the headlines recently.

There is some anger over whether these are signs of broader instability in the labor market.

But for now, they seem largely quiet, said Daniel Zhao, chief economist at employment review and job search site Glassdoor.

Zhao said the technology layoffs appear to be an extension of last year’s “year of efficiency” mantra, adding that these companies appear to be streamlining rather than operating out of a place where they are no longer financially viable.

“Some of these layoffs that are about streamlining and being more efficient don’t necessarily have the risk of spillover into the broader economy,” he said.

The data agrees: As of December, the monthly number of layoffs and the layoff rate as a percentage of total employment remain well below pre-pandemic averages, according to BLS Job Openings and Labor Turnover Survey (JOLTS) data . Week.

Additionally, Worker Adjustment and Retraining Notification Act filings — federally required notices of impending mass layoffs or plant closings — have not picked up on a year-over-year basis, Wells Fargo House said.

“They’ve slowed down a bit, indicating that we’re not going to see an imminent increase in layoffs unless you see a really sharp decline in demand,” he said.

Yet, amid the changing dynamics of the labor market, businesses are having to be more disciplined in terms of their workforce; Notably, very few people are leaving jobs, he said.

JOLTS data shows that workers are voluntarily leaving their jobs at the lowest rate since fall 2020. The hiring frenzy has subsided in recent years, and open jobs have become fewer; Plus, job switchers now have less financial incentive: Their average annual wage gain in January was 7.2%, the lowest since May 2021, according to payroll processor ADP.

Source: amp.cnn.com

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