Expect more layoffs
On the rule of threes, obfuscatory words in press releases, and why it's rarely just one thing that goes wrong in the job market
It’s often said that things happen in threes, but whatever limited truth of that is found elsewhere, it’s rarely the case when it comes to employment. In that case, once you start to hear of layoffs, expect to hear about them far more than three at a time.
■ IBM just announced that “we are executing an action that will impact a low single-digit percentage of our global workforce” -- a wildly obfuscatory way of saying “We are about to lay off thousands of people“. Target just laid off 1,000 while eliminating 800 open jobs. Amazon says that artificial intelligence is “transforming” 14,000 people out of work.
■ It’s not that any of the plans themselves are new. But big companies tend to respond to some of the very same factors and events (both in macroeconomics and in the news), and when there’s a lot of other bad news going on (like the longest Federal government shutdown in history), that may well provide a common trigger to act. Better to be the third-worst story in the news than the worst.
■ Big waves of layoffs are never a welcomed sign, and though the health of an economy always depends on more than just the number of jobs being created or lost, it can’t be overlooked that two-thirds of the US economy is made up of consumer spending. High incomes mean more spending, and people who lose their jobs (and spend less as a result) end up having spillover effects on other parts of the economy as they cut back.
■ It seems likely that there are other layoff announcements soon to come out, if for no other reasons but macroeconomic circumstances and public-relations timing. Nobody wants to be the last employer to this particularly unpleasant party.
