A new report released in late August by the Business Research Division at the University of Colorado Leeds School of Business revealed some exceptionally good news: Colorado stands to create 15,000 more jobs in 2018 than the division’s economists had earlier predicted. That would put the state at 62,600 new jobs created this year, compared with an earlier prediction of 47,100.
Some of those job openings have been filled through increased workforce participation, with some residents re-entering the workforce, or by those who previously were employed in part-time jobs. (That increase also occurred during a period of declining net migration.)
But it could also be that some of those jobs have been filled by workers laid off from other companies. According to a quick calculation of layoffs reported to the Colorado Department of Labor and Employment through the Worker Adjustment and Retraining Notification Act, layoffs thus far in 2018 already exceed the total for all of 2017, standing at 3,501 as of Aug. 28, compared with 3,099 layoffs for all of last year.
While owning a building seems like something every successful business should do, that’s not always the case. For many companies, it makes more sense to continue leasing space, freeing up time and capital that can be better utilized in other ways.
The numbers do not reflect all layoffs in the state, only those that are required to be reported by federal law. The WARN Act, passed in 1988, mandates that companies with 100 or more employees provide workers with 60 days’ notice of mass layoffs or plant closings. Many exemptions exist, including one that stipulates that layoffs of 50 to 499 workers are not covered by the WARN Act unless the number exceeds 33 percent of workers at a single employment site.
So other layoffs occur every day, but those that have been reported provide a snapshot of the economy.
In Colorado thus far in 2018, 29 companies have announced layoffs under the WARN Act, compared with 33 companies for all of 2017. This year’s layoffs include some significant ones in the Boulder Valley and Northern Colorado:
• Fluor, 54 jobs, Boulder County.
• Sandoz Inc., 65 jobs, Broomfield.
• Startek Inc., 186 jobs, Weld County.
Elsewhere around the state, layoffs have been announced by Chipotle Mexican Grill, cutting 399 jobs in Denver; Conduent Commercial Solutions LLC, cutting 410 jobs in Colorado Springs; St. Mary Corwin Medical Center, cutting 272 jobs in Pueblo; and Startek Inc., cutting 261 jobs in Colorado Springs, among others.
Businesses cut jobs for a variety of reasons, including consolidation, cost-cutting, relocation, loss of contracts, automation and other efficiencies, etc.
Some companies — such as Chipotle — are relocating their corporate headquarters outside the state, while others — such as Startek — are cutting jobs because of “changing business needs” of clients. Sometimes, businesses cut jobs in one area because of constraints in labor force or talent, or because of higher wage costs in one area versus another.
Is Colorado experiencing a wave of layoffs? Hardly. But the numbers and announcements bear watching, even as companies that are expanding breathe a slight sigh of relief that a few more workers are available.
Christopher Wood can be reached at 303-630-1942, 970-232-3133 or at email@example.com.