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Even as layoffs abound, jobless claims are falling

Mitchell Hartman Mar 7, 2023
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Layoffs have so far been concentrated in the tech sector, but the overall unemployment trend has remained near decade-lows. Eblis/Getty Images

Even as layoffs abound, jobless claims are falling

Mitchell Hartman Mar 7, 2023
Heard on:
Layoffs have so far been concentrated in the tech sector, but the overall unemployment trend has remained near decade-lows. Eblis/Getty Images
HTML EMBED:
COPY

There’s a bit of a mystery afoot when it comes to unemployment data.

We’ve seen headlines about big layoffs by big companies, some involving hundreds of workers. At the same time, however, the number of people filing claims for unemployment has been falling.

Last week, the unemployment rate fell below the level we saw consistently before the pandemic, and to a 54-year low. This at the same time that major companies have continued to announce mass layoffs.

“There’s a tale of two labor markets,” said Andy Challenger at outplacement firm Challenger Gray & Christmas. “Certain industries are cutting.”

Those industries include tech, banking and media as they adjust to higher interest rates in a post-pandemic economy.

Health care, education, bars and restaurants, meanwhile “still remain in a deep labor shortage, and they’re hiring like crazy,” Challenger said.

So far, job gains are balancing out job losses — and it’s happening fast.

ZipRecruiter surveyed workers laid off in December and January. Chief Economist Julia Pollak said more than half found new jobs by the end of January.

“And 42% of those found jobs that paid more than their old jobs,” she said.

According to Pollak, highly-skilled tech workers can get back on their feet the fastest. But she warned things might not look so rosy for less-skilled workers if job cuts spread.

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