Mass Layoffs Surge In January, Highest Since July 2009

Tyler Durden's picture

The BLS has reported Mass Layoff Statistics for January 2010 - the result is plain ugly, and kills any hope for sustained improvement in unemployment data. Not seasonally adjusted Mass Layoff Events (defined as at least 50 persons being laid off from a single employer) surged in January to 2,860, from 2,310 in January, from a 12 month low of 1,371 in September 2009. This is the biggest monthly surge since July when the Mass Layoff Events hit a 12 month high of 3,054. In terms of actual workers, January saw 278,679 initially laid off people. The deterioration was mirrored in the much less credible seasonally adjusted data. Obviously companies were waiting for the end of the year to dump as many people as they could.

The BLS data is charted below:



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Anonymous's picture

Yes, except for the extremely wealthy, 'rich people' are only rich untill they lose their job, then they become poor too. I guess that will make you happy when everybody is in the soup kitchen line.

CB's picture

I'd be happy when everyone is in the soup line? I didn't imply anything.  I added a link depicting unemployment by salary level and copied the title of the posting.  Duuude, get a grip....

Anonymous's picture

Your choice of descriptors implied it for you. You are playing the class warfare card my socialist friend. Without people with money to spend there are no jobs for those poor downtrodden folks. Gov't does not create wealth.

Anonymous's picture

i just wanted to do the math question

Whatta's picture

LOL. I failed math, so I had to join.

Cognitive Dissonance's picture

Exactly. Since I only have 10 fingers and 10 toes, any number above 20 was a real pain in the ass. After the first few times of asking my secretary to remove her shoes and show me her hands so I could count to 40, she threatened me with a sexual harassment lawsuit. Either I joined ZH or I got sued. It was an easy choice.

BTW, my secretary has great feet. Now I finally understand what a foot fetish is all about. :>))

sgt_doom's picture

Thanks, man!  I really appreciate the tip.

I've been trying to get my new neighbor to remove her shoes....

carbonmutant's picture

 I've always been able to get to 21 with no problem...

Cognitive Dissonance's picture

Ah yes, from the male point of view, the most important "digit" of them all. How could I have forgotten where the real brains of the operation resides?

Anonymous's picture

I thought I was the only one who did this.

You sir are a geek.


Neophiliac's picture

TD why do you always dismiss SA data? This is no bash, just a question. Your graph shows a very clear seasonal pattern. Ignoring it looks a bit cheeky. There may be errors in seasonal adjustment model, and you're welcome to point them out if you see them, but it's certainly not completely off. It's very much par for the course to lay off more people in January, and you can quite clearly see that in the recurring spikes in the NSA graph. 

pak's picture

Why adjust in the first place? Intelligent observers would be aware of seasonal factors anyway, and markets will discount them. Statistics is data. Application of seasonal adjustments to this data is analysis. Analysis can be good or bad. BLS should concentrate on accuracy of its data so that its "revisions" cannot be as ridiculous as it happens to GDP data, and leave analysis to others.

That's not even to mention that their "adjustments" only err on one side..

Neophiliac's picture

That's like saying they shouldn't do statistics at all. Part of a job that: running regressions to get as high degree of confidence as possible. And if you leave the seasonality in, your regression  turns out noisy as hell: what you didn't model in the variables ends up in the epsilon.

Can I run that regression? Sure, but that would involve me keeping a spreadsheet with this data going back a whole number of years. I don't have that kind of time, but I do like to look at meaningful information.

If you don't trust BLS statisticians - fine, that's your prerogative. But then can you show me a model that works better? Shouldn't be all that hard for an intelligent observer.

pak's picture

Data collection and data analysis are two different things by definition.

Anonymous's picture

I think the essential point that's been missed isn't that mass layoffs tend to happen in January, but the relationship between the severity of the event and the overall U3/U6 statistics when these occur. Lower mass layoff spikes are going to impact the economy less severely when the U3 is 6%, as opposed to a higher spike when it's pushing 10%.

Basically, people who used seasonal jobs to survive last year no longer have them, so if the U3 goes up again this month, I wouldn't be surprised.

sgt_doom's picture

Wrong, because Nov-Dec stats indicate minimal to almost little seasonal hiring.

Anonymous's picture

i do not believe that sa gives a whole picture....although
there may be some value in it as you suggest, the recent
tumult in the economy puts in doubt that the old sa
models apply....i think it is instructive to look at the
series with and without....

i have no idea how the weightings over time regress so
seeing it in the raw provides an additional perspective
which the sa masks....

Anonymous's picture

Not surprising. We're about to see the second leg of the equity unwind, companies have become very defensive again, the true extent of the bloodbath in December is becoming known and everyone's getting in position for the dance. I believe that 2010 will be a nasty year all told.

SDRII's picture

To preserve gross/operating margins and those better than expected EPS labor will continue to be "managed" for efficiencies. In the meantime, expect  better nominal toplines on lower volumes. Chalk another one up for the incredible shrinking middle class.  

BobPaulson's picture

Nice streak of good news today. Creeeeeak....

Cindy_Dies_In_The_End's picture

Heh, heh. And yeah, after that, I get the Sara Connor Syndrome moments, but then I let the whiskey kick in.

MsCreant's picture

PMs and Dow Down. They have been tracking together a while.

Stevm30's picture

Well if they fire people now, then they can get a tax break when they hire them back, once the "JOBS" bill passes.

Problem Is's picture

Gun and ammo stores and pawnshops are hiring...

Ripped Chunk's picture

Leo!?    Leo?    Anybody?  Bueller?

berated's picture

I miss Cetin. I can't see the word "surge" without thinking of him fondly....

Gordon_Gekko's picture

I think it's ALL CLEAR for the SPX (yes, SPX) to rise to 10,000 now.

Anonymous's picture

Buy the dips!

gookempucky's picture

My GOD just hit this planet with an asteroid and lets be done with it.

Whatta's picture

If this Obama economy turns into an official Depression...can we official name it the O'pression???

girl money's picture

Whatta fine idea.  Psst... we're already there.

bugs_'s picture

Totally validates everyones expectations.

Get government out of the stats business.

Get government out of the bank business.

Get government out of the car business.

Get government out of the hospital business.


Neophiliac's picture

Nice about stats. Who's gonna do them then? Goldman Sachs? S&P? And you gonna trust them?


Cindy_Dies_In_The_End's picture

Yeah um, its called Shadowstats.

Stranger's picture

Shadowstats uses government stats as its data base.

MsCreant's picture

Put this government out of business, period.

Postal's picture

Not until I get another job! I need my gov't job--only source of income (yeah, I know... but for now the fiat paper buys freeze dried food and silver).

curbyourrisk's picture

1000 people to be laid off by the MTA in NY today

1000 people to be laid off inthe San Fran school system today.


The htis just keep on coming and coming.  Gotta love greenshoots you can take home and smoke....easier to deal witht he pain that way.

girl money's picture

Kmart closing in Austin, MN -- 1000 jobs gone

75-year old Stephens Supply in once booming Fuquay-Varina (Raleigh/Durham suburb) closing 2 of 3 divisions.

Although the job loss number is small, going from 55 to 15, I'm posting this because I believe the CEO's comment is much closer to the truth than anything we'll hear on CNBS:

"We just decided that the duration of the downturn had been too long and we don't see any end to it," Carver said. "We just decided it was not practical to stick it out for the return" of the building business."

-- Wayne Carver, CEO

Mad Max's picture

1) There's a K-Mart still open somewhere?

2) K-Mart employs 1000 people at a store?  See question #1.

Anonymous's picture

"That brings to 56 the number of stores that the owner of Sears and Kmart has said over the past year that it will close. About 1,000 jobs will be affected."

Good call, Max

girl money's picture

MMax, thanks so much for catching this... it's Sears Holdings closing 21 stores, totalling 1,000 jobs lost.  that did sound like a lot for a MN Kmart, should have verified.  please accept my apologies.

AnonymousMonetarist's picture

Aside from the empirical fact that unemployment levels are as bad as, if not worse than, the Great Depression, admittedly there is an important difference.

In the 30s the labor force actually grew.

Where did you go Joe? A nation bids its' unemployed adieu...

Anonymous's picture

PPI up CPI declines. Producers can't pass costs to customers. More layoffs to cut overhead. More unemployed. Less demand

toathis's picture

Peter Schiff's Ultimate Prediction, Will he be wrong?

girl money's picture

Schiff pronounces it "Barack O-Baja" at the very end of this clip.  Methinks it was intentional.

Problem Is's picture

Not To Worry Everyone:  BLS Has The Answer!

From Bill the Brain at Calculated Risk:

Five Million Workers to Exhaust Unemployment Benefits by June

"1.2 million workers facing a cut off of benefits in March"

"There are a record 6.31 million workers who have been unemployed for more than 26 weeks (and still want a job). This is a record 4.1% of the civilian workforce. (note: records started in 1948)."

You see without unemployment insurance, the BLS will now classify those 1.2 million workers in March as "Marginally Attached" and no longer unemployed by U3.

See, better already...

Then President Barry O-Hoover will announce the stimulus has "saved" another 1.2 million jobs...

Postal's picture

The beatings will continue until morale improves...

Problem Is's picture

"The beatings will continue until morale improves..."

Moral will be the referendum item up for vote come November 2010...