3 Big Reasons Many Americans Are Worried About Layoffs — Should You Be Too?
Written by
Caitlyn Moorhead
Edited by
Jenna Klaverweiden
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No one expects the firing squad, but in times of economic turmoil, your livelihood seems to become equal parts crucial and in peril. In recent months, or years it would seem, concerns about layoffs have permeated across various sectors of the U.S. workforce. The uncertainty surrounding employment has left many workers on edge, fearing that their jobs could be the next to go.
Unfounded or not, the feeling of the impending doom of unemployment is palpable in many industries. Here are three big reasons Americans are worried about layoffs.
Also see six ways to build wealth after a layoff.
Economic Uncertainty and Unemployment
The economy is always subject to fluctuations, but recent developments seem to have an accelerant added to the mix. With everything from inflation to supply chain demands, general costs for both employer and employee have contributed to heightened concerns.
Everyone’s wallet is feeling the pinch, and increased operating costs for companies pressure management to cut back on expenditures, including labor. In addition, industries that depend on global supply chains are dealing with delays and rising costs, making it difficult to maintain profit margins.
Should You Worry?
If you work in sectors that are highly sensitive to economic changes, such as manufacturing, retail or logistics, it’s wise to stay informed and prepare for the possibility of workforce reductions. In contrast, if you’re in a more stable or growing industry, your chances of being affected by layoffs may be lower, but it’s always good to remain vigilant.
GOBankingRates has done research on the unemployment rate in every state, and here are some interesting findings:
- Of the 50 states, Nevada has the highest unemployment rate at 7%, whereas North Dakota has the lowest at 2.9%.
- Eleven states have an unemployment rate of 6% or higher, including Michigan, California, Louisiana and New Jersey.
- More than half of states have an unemployment rate of at least 5%.
Corporate Restructuring
Many companies are undergoing restructuring efforts to streamline operations and stay competitive. These efforts often result in cost-cutting measures, including workforce reductions. Layoffs in these cases are typically part of a broader strategy to realign company resources or refocus on core business areas.
For example, if you work in tech, particularly in roles susceptible to automation, such as customer service or data entry, it might be time to upskill or transition into areas of tech that are less likely to be affected, such as artificial intelligence development or cybersecurity. Workers outside of tech might feel a less direct impact, but it’s essential to recognize that automation trends are affecting more industries every day.
Should You Worry?
If your company has recently announced plans for mergers, acquisitions or restructuring, layoffs could be on the horizon. In this situation, it’s important to stay updated on any internal communications and consider making contingency plans, such as networking within your industry and updating your resume just in case.
Remote Work vs. Office Work
The rise of remote work has introduced flexibility and cost savings for many companies, but it has also led to a shift in hiring practices. Some organizations are opting to outsource jobs to cheaper labor markets, both domestically and abroad, reducing the need for in-house staff. This shift is particularly noticeable in sectors like customer service, tech support and administrative roles.
There has also been a push and pull between keeping remote protocols set up during the pandemic and mandating a return to office. This can be tricky to navigate. For example, if you moved to another state when you were allowed to work remotely and are now expected to come back to work, job loss might not be unexpected.
Should You Worry?
If your role is one that could easily be outsourced, the rise of remote work might pose a threat. However, if you’re in a position that requires a high level of specialization or in-person collaboration, your job is likely more secure. On the other hand, being a remote worker can also open up your job opportunities across the country and maybe even borders, giving you ample employment opportunities.
Final Take To GO
The bottom line is that while there are valid reasons for concern, not every worker will be laid off tomorrow. No one likes the idea of losing their job or income, and if it’s any comfort, you are not alone in your worry. However, you may not be as likely to lose your job or stay unemployed as you might think.
Methodology: Using the U.S. Census American Community Survey, the unemployment rate and labor force participation rate were both sourced for each state. The states were sorted to show the highest to lowest unemployment rates. All data was collected on and is up to date as of Sept. 13, 2024.
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