RALEIGH – Unless there is a late arriving notice, 2022 ended up as the best year for North Carolina workers since at least 1997, despite recent headlines about recession, layoffs, and job cuts.
That’s because North Carolina’s unemployment rate remains historically low, and workers in the state are on track to experience a record low number of layoff and closure events, according to data from the North Carolina Department of Commerce.
As of Jan. 10 the layoff data has not changed since WRAL TechWire reported in mid December that layoff numbers and plant closures were low on a historical basis.
The layoff news belies headlines about the growing number of tech layoffs nationally.
“Tech layoffs are overhyped,” said Dr. Gerald Cohen, the chief economist at the Kenan Institute, in an interview with WRAL TechWire. “Not a good indicator of what is going on.”
Cohen, who earlier this month guaranteed that the United States economy would experience a downturn in 2023, told WRAL TechWire that he still believes any coming recession would be mild.
Layoffs and closings jumped significantly in 2020 following the onset of the COVID-19 pandemic, including 226 temporary layoffs.
But in 2021, the number of combined layoffs and closings fell to near-record lows during a period of recovery. Thus far, this year, the numbers are even lower as not since 2015 has the number of permanent layoffs been close to the 2022 figures, data show.
When it comes to layoffs, the North Carolina Department of Commerce tracks mass layoff events, include permanent layoffs, temporary layoffs, and permanent closures of facilities, under the Worker Adjustment and Retraining Notification (WARN) Act, which is meant to provide employees advance notice of qualified plant closings and mass layoffs.
Thus far in 2022, through December 15, only 42 such events have occurred, the fewest in the data set reviewed by WRAL TechWire, which spans back to 1997.
The latest edition of the report maintained by the North Carolina Department of Commerce also shows that 4,204 workers in North Carolina have been affected by layoffs or plant closures thus far in 2022.
That's also the fewest number of workers who have received such notice, under the WARN Act, in the data set.
North Carolina's labor market remains resilient
Still, workers in North Carolina will be affected should a layoff occur, including those workers at Lenovo, Cisco, and N-able, all companies that recently confirmed to WRAL TechWire that jobs in the Triangle have been cut recently.
Yet the job market remains a healthy labor market, said Cohen. "While tech companies are under pressure and may be shedding jobs, those workers are still in very high demand by other sectors," Cohen noted.
Further, on the whole, job openings remain quite elevated. "Adjusted for size, North Carolina has relatively more openings than the rest of the United States," Cohen said.
However, there is reason for caution.
Layoffs tend to increase the year prior to a recession, said Dr. Michael Walden, an economist and a William Neal Reynolds Distinguished Professor Emeritus at North Carolina State University. Layoffs would also increase during a recession, too, he noted. And he sees warning signs.
"The upward trend in layoffs matches other indicators that are flashing 'slowdown' in North Carolina," said Walden. "For workers, my message has been consistently clear—keep the job you have, strive to be indispensable, and if you don’t have a job, take the first one that meets your minimum requirements."