The start of the year was plagued by waves of layoffs: through the end of May, companies announced plans to cut 417,500 jobs, up 315% from the same period last year, according to Challenger, Gray & Christmas. Big names like Disney, Google, Lyft and Meta were among those announcing cuts.
Figuring out if your company might be next isn’t easy, but there are some clues to watch for, experts say.
“There are signs that will send shivers down your spine,” said Suzy Welch, a career advisor and CNBC contributor.
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The state of layoffs
The tech industry has led layoff headlines, with more than 206,000 workers losing their jobs so far in 2023, according to Layoffs.fyi, a survey that keeps score of tech roles in the industry.
But every industry except for four — education, government, industrial manufacturing and utilities — has seen an increase in layoffs this year, according to Challenger, Gray & Christmas data.
Retailers laid off 45,168 workers through May, while financial firms announced 36,937 cuts, the firm found. The media industry slashed 17,436, its highest year-to-date tally on record.
Overall layoffs declined to 1.6 million in April from 1.8 million in March, according to the latest figures from the Job Openings and Labor Turnover Summary (JOLTS), a measure that also serves as a recession indicator.
“When the involuntary rate goes up, we are looking at more recessionary times,” said economist José Fernández, an associate professor at University of Louisville. “But if the voluntary rate is going up, it’s saying that workers have more demand, so they’re out there trying to get a better opportunity for themselves.”
Amazon, Dropbox and Lyft had the biggest layoffs in the tech industry for April. Google and Facebook parent Meta Platforms are responsible for the most tech layoffs since the pandemic, according to Layoffs.fyi.
Look at WARN notices in your state
WARN notices get their name from the Worker Adjustment and Retraining Notification Act of 1988, a labor-protection law that requires companies with 100 or more employees to provide a 60 calendar-day notice of planned closings and layoffs.
In her video, Tu suggests searching for WARN notices in your state and others where your company does business to find the state government website that lists companies letting go of employees.
However, sometimes companies can avoid releasing these notices by spreading out the layoffs, said Susan Houseman, director of research for the W.E. Upjohn Institute for Employment Research.
“So maybe you’re going to lay off 75, say you lay off 40 one month and 26 the next to avoid WARN notice,” she said.
The law also protects employers by providing exceptions, such as unforeseen circumstances where the company could not have given a two-month notice to employees.
“All of a sudden something happens, demand for your product does a sudden nose[dive], and you just have to lay off workers, and you don’t have time to give them a 60-day notice,” Houseman said.
She clarified that this exception is not a solution for companies undergoing bankruptcies, because “you can’t have anticipated the bankruptcy 60 days out and declined to give notice.”
“Unless there’s rigorous enforcement of this, there certainly can be circumstances where companies should have given notice and didn’t,” Houseman said.
More ways to scope out layoffs
WARN notices are not the only red flags that can signal pending layoffs. Welch offers three more ways to investigate:
- Pretend you are an investor and follow news on your company. “Sometimes the earliest canary in the coal mine are the industry media,” Welch said. Monitor your company online by reading what industry analysts and other experts are saying on different platforms about its finances and prospects. Subscribe to newsletters, blogs and outlets that cover your industry to keep a closer look at trends in your sector.
- Pay attention to your company’s financial health. Workers can know how their company is doing financially by paying attention to earnings reports and guidance, and movements in its share price. “You have to have the discipline to take a look at what the markets are saying about your company and which way the stock price is going,” Welch said.
- Watch your boss for clues. A trusting relationship with your supervisor can positively impact your work life on several fronts. You could hear of an incoming layoff earliest from them, as they will know before you. “Your boss is a human being. A boss will share that information with members of the team that they really trust,” Welch said.
Of course, cost cutting is another sign to watch out for. Some examples include the cancellation of annual or regular events, or programs, projects and perks.
“Anything that signals resource cuts that are not people, companies generally will try to cut projects, programs and events before they start cutting staff. You can be concerned that they are coming for people next,” Welch said.