Bloomberg News

U.S. Mass Layoffs Report for January (Text)

February 26, 2013

Following is the text of the monthly mass layoffs release from the Bureau of Labor Statistics.

Employers took 1,328 mass layoff actions in January involving 134,026 workers as measured by new filings for unemployment insurance benefits during the month, the U.S. Bureau of Labor Statistics reported today. (Data are seasonally adjusted.) Each mass layoff involved at least 50 workers from a single employer. Mass layoff events decreased by 181 from December, and the number of associated initial claims decreased by 3,813. In January, 357 mass layoff events were reported in the manufacturing sector resulting in 43,068 initial claims. Monthly mass layoff data are identified using administrative data sources without regard to layoff duration.

The national unemployment rate was 7.9 percent in January, essentially unchanged from the prior month and down from 8.3 percent a year earlier. Total nonfarm payroll employment increased by 157,000 over the month and by 2,016,000 over the year.

Industry Distribution (Not Seasonally Adjusted)

The number of mass layoff events in January was 1,528, not seasonally adjusted, resulting in 144,517 initial claims for unemployment insurance. Over the year, the number of average weekly mass layoff events for January decreased by 44 to 382, while associated average weekly initial claims increased by 703 to 36,129. Eight of the 19 major industry sectors in the private economy reported over-the-year increases in average weekly initial claims, with the largest increase occurring in manufacturing. The six-digit industry with the largest number of private nonfarm initial claims due to mass layoffs in January was temporary help services.

In January, the manufacturing sector accounted for 31 percent of mass layoff events and 37 percent of associated initial claims in the private economy. Within manufacturing, the numbers of mass layoff claimants were highest in transportation equipment and in food. Eleven of the 21 manufacturing subsectors experienced over-the-year increases in average weekly initial claims.

Geographic Distribution (Not Seasonally Adjusted)

Among the census regions, the South had the largest number of initial claims due to mass layoffs in January. Three of the 4 regions experienced over-the-year increases in average weekly initial claims, with the largest increase occurring in the South.

Among the states, California had the highest number of mass layoff initial claims in January, followed by North Carolina, Alabama, and New York. Twenty-five states experienced over-the- year increases in average weekly initial claims, led by California and North Carolina.

Note

The monthly data series in this release cover mass layoffs of 50 or more workers beginning in a given month, regardless of the duration of the layoffs. For private nonfarm establishments, information on the length of the layoff is obtained later and issued in a quarterly release that reports on mass layoffs lasting more than 30 days (referred to as “extended mass layoffs”). The quarterly release provides more information on the industry classification and location of the establishment and on the demographics of the laid-off workers. The monthly data series in this release are subjected to average weekly analysis, which mitigates the effect of differing lengths of months. See the Technical Note for more detailed definitions and for a description of average weekly analysis.

The Mass Layoffs new release for February 2013 is scheduled to be released on Friday, March 22, 2013, at 10:00 a.m. (EDT).

Technical Note

The Mass Layoff Statistics (MLS) program is a federal-state program that uses a standardized automated approach to identifying, describing, and tracking the effects of major job cutbacks, using data from each state’s unemployment insurance database. Each month, states report on employers which have at least 50 initial claims filed against them during a consecutive 5-week period. These employers then are contacted by the state agency to determine whether these separations lasted 31 days or longer, and, if so, other information concerning the layoff is collected. States report on layoffs lasting more than 1 month on a quarterly basis.

The monthly data present preliminary mass layoff activity in the reference month and are not revised in subsequent months except in special circumstances (e.g., layoffs in states affected by Hurricane Katrina). Counts of initial claims associated with mass layoff events reflect activity through the end of the reference month. Additional mass layoff event and initial claims activity received after data for the reference month have been published by BLS are not updated in the monthly mass layoff series and, therefore, may not match revised mass layoff data issued in state publications. However, any additional mass layoff information meeting the extended mass layoff criteria will be reflected in BLS’ quarterly publication of extended mass layoff data.

A given month contains an aggregation of the weekly unemployment insurance claims filings for the Sunday through Saturday weeks in that month. All weeks are included for the particular month, except if the first day of the month falls on Saturday. In this case, the week is included in the prior month’s tabulations. This means that some months will contain 4 weeks and others, 5 weeks. The number of weeks in a given month may be different from year to year, and the number of weeks in a year may vary. Therefore, data users who intend to perform analysis of over-the-year change in the not seasonally adjusted series should use the average weekly mass layoff figures displayed in tables 3 and 4 of this release. The average weekly adjustment process produces a consistent series for each month across all years, permitting over-the-year analysis to be performed using strictly comparable data.

The MLS program resumed operations in April 1995 after it had been terminated in November 1992 due to lack of funding. Prior to April 1995, monthly layoff statistics were not available.

Information in this release will be made available to sensory impaired individuals upon request. Voice phone: (202) 691-5200; Federal Relay Service: (800) 877-8339.

Definitions

Average weekly mass layoff events and initial claimants. The number of events and initial claimants in a given month divided by the number of weeks contained within that month.

Employer.

Employers in the MLS program include those covered by state unemployment insurance laws. Information on employers is obtained from the Quarterly Census of Employment and Wages (QCEW) program, which is administered by the Bureau of Labor Statistics (BLS).

Industry.

Employers are classified according to the 2007 version of the North American Industry Classification System (NAICS). For temporary help and professional employers organization industries, monthly MLS-related statistics generally reflect layoffs related to underlying client companies in other industries. An individual layoff action at a client company can be small, but when initial claimants associated with many such layoffs are assigned to a temporary help or professional employer organization firm, a mass layoff event may trigger.

Initial claimant.

A person who files any notice of unemployment to initiate a request either for a determination of entitlement to and eligibility for compensation, or for a subsequent period of unemployment within a benefit year or period of eligibility.

Mass layoff event.

Fifty or more initial claims for unemployment insurance benefits filed against an employer during a 5-week period, regardless of duration.

Seasonal adjustment

Effective with the release of data for January 2005, BLS began publishing six seasonally adjusted monthly MLS series. The six series are the numbers of mass layoff events and mass layoff initial claims for the total, private nonfarm, and manufacturing sectors.

Seasonal adjustment is the process of estimating and removing the effect on time series data of regularly recurring seasonal events such as changes in the weather, holidays, and the beginning and ending of the school year. The use of seasonal adjustment makes it easier to observe fundamental changes in time series, particularly those associated with general economic expansions and contractions.

The MLS data are seasonally adjusted using the X-12-ARIMA seasonal adjustment method on a concurrent basis. Concurrent seasonal adjustment uses all available monthly estimates, including those for the current month, in developing seasonal adjustment factors. Revisions to the most recent 5 years of seasonally adjusted data will be made once a year with the issuance of December data. Before the data are seasonally adjusted, prior adjustments are made to the original data to adjust them for differences in the number of weeks used to calculate the monthly data. Because weekly unemployment insurance claims are aggregated to form monthly data, a particular month’s value could be calculated with 5 weeks of data in 1 year and 4 weeks in another. The effects of these differences could seriously distort the seasonal factors if they were ignored in the seasonal adjustment process. These effects are modeled in the X-12-ARIMA program and are permanently removed from the final seasonally adjusted series.

SOURCE: U.S. Department of Labor

To contact the reporter on this story: Chris Middleton in Washington at cmiddleton2@bloomberg.net

To contact the editor responsible for this story: Marco Babic at mbabic@bloomberg.net


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