Layoffs picked up in November as labor market cools down
Layoffs picked up in November as labor market cools down
The number of layoff announcements rose about 4% in November from the month before, according to the outplacement company Challenger, Gray and Christmas.
Layoffs overall have been pretty subdued ever since the early stages of the pandemic, but the pickup in November is a sign that the labor market is starting to lose momentum.
A lot of businesses are in a tricky spot right now, according to Gregory Daco, chief economist at EY. Consumer demand has started to slow, but he said wages remain elevated. Hiring has cooled off.
“You’re seeing employees staying longer in place. You’re also seeing hiring managers being more careful with who they hire,” Daco said.
Some companies have started reducing staff through strategic layoffs based on performance or through attrition, he added. “Using the ability of some individuals to leave the firm or to retire and not necessarily replacing them as they exit.”
That said, we’re not seeing many companies announce widespread layoffs. That’s because the economy is still growing, per Kathy Bostjancic, chief economist at Nationwide.
“Like, it will take a meaningful slowdown in the economy — that’s over a prolonged period — for companies to act,” she said.
And given how hard it’s been for companies to find workers over the last few years, Bostjancic said they’re probably extra reluctant to let them go.
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