However, despite recent layoff news about media, tech, and other prominent industries, the layoffs and discharges rate for the country has persistently stayed low, according to data released by the Bureau of Labor Statistics.
Nick Bunker, the economic research director for North America at the Indeed Hiring Lab, noted in recent commentary that recent layoff news doesn’t indicate what the rest of the workforce is experiencing, similar to the spate of tech layoffs in early 2023.
“Both waves of tech layoffs appear to be mostly about rebalancing workforces to adjust to the current economic outlook after a burst of hiring in 2021,” Bunker said. “That phenomenon is not happening in the broader labor market.”
That is, while it may seem like we keep hearing about new job cuts, this news is not representative of what layoffs among companies have actually looked like.
A Tuesday news release from the Bureau of Labor Statistics shows that the US layoffs and discharges rate was 1.0% in December and has hovered near that rate throughout 2023.
Still, the news from companies in tech can be important to note.
“What happens in tech may have an outsized salience to everybody, because it’s sort of the pinnacle of the US economy,” Julia Pollak, ZipRecruiter’s chief economist, told Business Insider in early 2023.
But even the latest data for the information sector — which includes some of the tech industry as well as broadcasting, newspapers, and others in the publishing world — shows no recent surge in layoffs. That sector had a layoffs and discharges rate of 0.8% in December, which is actually a small dip from the 0.9% in November. The new data point also suggests a big drop from how the sector kicked off 2023. It had a rate of 1.5%, same as the monthly rates in the last quarter of 2022.
Daniel Zhao, lead economist for Glassdoor, wrote in commentary about the new data that “layoffs remain low by historical standards.” The number of layoffs and discharges in December was 1.6 million. Zhao noted that “the scale here” means that this number probably isn’t really going to change because of the recent layoff announcements.
There are also industries that had a higher layoffs and discharges rate than the information sector in December, such as construction as well as leisure and hospitality. While the rate for the construction sector was 2.1% in December, that’s not too high when looking at historical data.
Other parts of the latest data release also show a still-strong labor market. Amid the December layoffs and discharges, there were 9.0 million job openings, which isn’t too far off from November’s level. The monthly number of quits dropped slightly — from 3.5 million in November to 3.4 million in December.
The number of hires did tick up in December but is still cooler than in the past. For instance, December’s level was 5.6 million compared to over 6 million a year ago in December 2022.
“Lower hiring can lead to a higher unemployment rate as workers out of a job have a harder time finding work,” Bunker wrote in commentary about the new data release. “The good news is that the ranks of the newly jobless are unlikely to increase: the layoff rate is still very low and has only been above its pre-pandemic low for one month of the last three years.”
Labor market experts already expect it to be tougher to get work this year. Kory Kantenga, senior economist at LinkedIn, said in a written statement to Business Insider in late 2023 that “we expect to see continued caution in hiring on the part of employers moving into 2024.”
This also comes at a time when the US economy ended last year holding strong. The advance estimate for GDP in the fourth quarter came in above the forecast. While real GDP was expected to grow at an annualized rate of 2.0%, the estimate was 3.3%.
“It’s unusual to be in this middle ground where lower hiring isn’t married with higher layoffs, but it offers some optimism that a re-acceleration in the economy could thaw the freeze, boosting hires & quits,” Zhao recently wrote.
Have you recently been laid off? Share your story with this reporter at mhoff@businessinsider.com.
