Permanent Job Losses Rise to 3-Year High in November: Bureau of Labor Statistics

A hiring sign is displayed in front of Abercrombie & Fitch at the Tysons Corner Center mall in Tysons, Va., on Aug. 22, 2024. Anna Rose Layden/Getty Images

New labor market data show that the number of permanent job losses—a measure of workers who lost their employment and were not expected to be recalled by their employers—increased for the second consecutive month.

According to data from the Bureau of Labor Statistics (BLS), the total number of permanent job losers rose by 58,000 monthly to 1.893 million in November, a three-year high.

This is higher than the pre-pandemic level of about 1.3 million.

Even as the broader U.S. employment arena remains solid, this measure has been trending slightly upward since September 2022—and it may foreshadow a recession.

The number of permanent job losers steadily climbed heading into the downturn of 2001 and the global financial crisis of 2008–09. At the onset of the coronavirus pandemic, the metric also spiked and peaked in September 2020 before plummeting in the subsequent months.

A rise in permanent job losses can correspond with struggling companies, resulting in more layoffs and fewer hirings.

Meanwhile, according to new data from global recruitment firm Challenger, Gray & Christmas, U.S.-based companies have announced 722,566 layoffs this year, up more than 5 percent from the same 11-month span a year ago. Outside of the public health crisis, this is the highest number since 2009, when nearly 1.3 million job cuts were announced from January to November.

The October Job Openings and Labor Turnover (JOLTS) report showed that the number of hires has declined by more than 500,000 since October 2023. Likewise, the decreasing pace of hires has been observed prior to the 2001 and 2008 recessions.

Businesses have been curtailing their hiring and personnel plans for a while.

The recent Freedom Economy Index, a monthly survey of 100,000 small-business owners conducted by RedBalloon and PublicSquare, showed that 77 percent of companies are neither hiring nor reducing staff.

Reasons for these decisions vary, from inflation challenges to slowing economic conditions.

“My clients and potential clients are facing so much inflation that they can’t afford to hire and/or keep me serving their business,” one business owner said in the survey.

Other notable employment trends have also been forming over the past year.

In the last 12 months, full-time jobs have declined by approximately 1.4 million. In addition, part-time positions have tumbled by close to one million over the last seven months.

Market watchers were also concerned that the July jobs data triggered the Sahm Rule, a leading recession indicator. When the three-month moving average of unemployment rises by at least 0.5 percentage points above the lowest three-month moving average jobless rate over the previous 12 months, the country might be in or on the cusp of a downturn.

Since then, the unemployment rate has stabilized between 4.1 percent and 4.2 percent. In July, it was 4.3 percent, the highest since October 2021.

Optimism Ahead

Economic observers are not panicking as the labor market keeps adding jobs, and the national economy continues growing.

A 'Now Hiring' sign on the window of an In-N-Out fast-food restaurant in Encinitas, Calif., on May 9, 2022. Mike Blake/Reuters

Last month, 227,000 jobs were created, higher than the consensus estimate of about 200,000. The economy rebounded from an abysmal October jobs report that showed an upwardly revised 36,000 positions, the worst since December 2020.

Over the previous three months, the nation has averaged 173,000 new positions.

“Today’s report tells us we are clearly not entering into a recession,” said Gina Bolvin, the president of Bolvin Wealth Management Group, in a note emailed to The Epoch Times. “This job report was a quality print and tells us the job market remains healthy and steady.”

As for the wider economy, the Federal Reserve Bank of Atlanta’s GDPNow model estimates fourth-quarter GDP growth at 3.3 percent.

Stephanie Ferguson Melhorn, the senior director at the U.S. Chamber of Commerce, says one long-term issue facing the U.S. economy is a shortage of workers.

Before the pandemic, the labor force-participation rate was 63.3 percent. Today, it stands at 62.5 percent, hovering around this figure for nearly two years.

“In fact, the decline of Americans’ labor force participation is nothing new—fewer and fewer Americans have been participating in the labor force for decades, resulting in a smaller workforce that is expected to continue shrinking for years to come,” Ferguson said in a recent report.

Ultimately, looking ahead, Fed policymakers are optimistic that the U.S. labor market will remain intact over the next two years, pointing to the supply-demand dynamics coming into better balance.

According to the central bank’s September Summary of Economic Projections, the unemployment rate is projected to be 4.4 percent in 2025, 4.3 percent in 2026