Employee Layoff Analysis 2022

Running head: Employee Layoff
Employee Layoff
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Employee Layoff1
Employment layoff
There are several reasons behind unemployment of labors, which includes demand
and supply gap between employers and employees, demand for highly skilled labors and the
lower wages of the companies. Under such a situation, the natural rate of unemployment can
be healthy for an economy suffering from such economic gaps. This is because of high-
interest rates that reduce investment and affects the growth of a business. Recently, the Fed is
reducing the interest rate of the US. Despite this cut in interest rate, the inflation and the
wages are low. A lower interest rate is beneficial for business growth, as destined by the
Federal Reserve of the US. This kind of natural rate of unemployment is harmful to any
economy. Moreover, there can be labor layoffs, which can occur due to downsizing or
restructuring of a business (Murtin & Robin, 2018). Workers of a company are laid off either
on a temporary or permanent basis. Corporations or organizations undergoing restructuring
layoff employees temporarily and hire them after the process. On the other hand, downsizing
companies layoff workers permanently. The data below indicates an increase in the total
number of layoffs by companies.
Figure 1: Different forms of unemployment

Employee Layoff2
(Source: Bls.gov, 2020)
The diagram indicates an increase in the number of layoffs in January 2019. Labor
layoff can occur due to the merger of firms, acquisition and performance degradation. There
are several industries that layoff labors, which includes the Steel or manufacturing industry
and media sector (Mitsopoulos, 2016). The newsroom or media department of the United
States has recorded an increase in the number of employees departed. In addition to this, the
wages of the newsroom sector are continuously falling from a lifelong of poorer wage
condition. Low wage and difference in salaries are a huge problem that leads to
unemployment (Pinheiro & Visschers, 2015). Therefore, there is an increase in
unemployment derived from this sector.
Figure 2: US unemployment in the media sector
(Source: pewresearch.org, 2019)