Mass Layoffs Technical Note

Technical Note


   The Mass Layoff Statistics (MLS) program is a federal-state program
that uses a standardized automated approach to identifying, describing,
and tracking the effects of major job cutbacks, using data from each
state's unemployment insurance database. Each month, states report on
employers which have at least 50 initial claims filed against them during
a consecutive 5-week period. These employers then are contacted by the
state agency to determine whether these separations lasted 31 days or
longer, and, if so, other information concerning the layoff is collected.
States report on layoffs lasting more than 1 month on a quarterly basis.

   The monthly data present preliminary mass layoff activity in the 
reference month and are not revised in subsequent months except in special 
circumstances (e.g., layoffs in states affected by Hurricane Katrina).  
Counts of initial claims associated with mass layoff events reflect 
activity through the end of the reference month. Additional mass layoff 
event and initial claims activity received after data for the reference 
month have been published by BLS are not updated in the monthly mass layoff 
series and, therefore, may not match revised mass layoff data issued in 
state publications. However, any additional mass layoff information 
meeting the extended mass layoff criteria will be reflected in BLSí 
quarterly publication of extended mass layoff data.

   A given month contains an aggregation of the weekly unemployment 
insurance claims filings for the Sunday through Saturday weeks in that 
month.  All weeks are included for the particular month, except if the
first day of the month falls on Saturday.  In this case, the week is 
included in the prior month's tabulations.  This means that some months
will contain 4 weeks and others, 5 weeks.  The number of weeks in a given
month may be different from year to year, and the number of weeks in a year
may vary.  Therefore, data users who intend to perform analysis of over-the-year
change in the not seasonally adjusted series should use the average weekly
mass layoff figures displayed in tables 3 and 4 of this release.  The average
weekly adjustment process produces a consistent series for each month across
all years, permitting over-the-year analysis to be performed using strictly
comparable data.

   The MLS program resumed operations in April 1995 after it had been
terminated in November 1992 due to lack of funding. Prior to April 1995,
monthly layoff statistics were not available.

   Information in this release will be made available to sensory impaired
individuals upon request. Voice phone:  (202) 691-5200; Federal Relay
Service:  (800) 877-8339.

Definitions

   Average weekly mass layoff events and initial claimants. The number of
events and initial claimants in a given month divided by the number of weeks
contained within that month.

   Employer. Employers in the MLS program include those covered by state
unemployment insurance laws. Information on employers is obtained from the
Quarterly Census of Employment and Wages (QCEW) program, which is administered
by the Bureau of Labor Statistics (BLS).

   Industry. Employers are classified according to the 2007 version of the 
North American Industry Classification System (NAICS). For temporary help
and professional employers organization industries, monthly MLS-related 
statistics generally reflect layoffs related to underlying client companies 
in other industries. An individual layoff action at a client company can
be small, but when initial claimants associated with many such layoffs are
assigned to a temporary help or professional employer organization firm, a
mass layoff event may trigger.

   Initial claimant. A person who files any notice of unemployment to
initiate a request either for a determination of entitlement to and
eligibility for compensation, or for a subsequent period of unemployment
within a benefit year or period of eligibility.

   Mass layoff event. Fifty or more initial claims for unemployment insurance
benefits filed against an employer during a 5-week period, regardless of
duration.

Seasonal adjustment

   Effective with the release of data for January 2005, BLS began publishing
six seasonally adjusted monthly MLS series. The six series are the numbers of
mass layoff events and mass layoff initial claims for the total, private nonfarm,
and manufacturing sectors.
   
   Seasonal adjustment is the process of estimating and removing the effect
on time series data of regularly recurring seasonal events such as changes
in the weather, holidays, and the beginning and ending of the school year.
The use of seasonal adjustment makes it easier to observe fundamental changes
in time series, particularly those associated with general economic expansions
and contractions.

   The MLS data are seasonally adjusted using the X-12-ARIMA seasonal adjustment
method on a concurrent basis. Concurrent seasonal adjustment uses all available
monthly estimates, including those for the current month, in developing seasonal
adjustment factors. Revisions to the most recent 5 years of seasonally adjusted
data will be made once a year with the issuance of December data. Before the data
are seasonally adjusted, prior adjustments are made to the original data to adjust
them for differences in the number of weeks used to calculate the monthly data.
Because weekly unemployment insurance claims are aggregated to form monthly data,
a particular month's value could be calculated with 5 weeks of data in 1 year and
4 weeks in another. The effects of these differences could seriously distort the
seasonal factors if they were ignored in the seasonal adjustment process. These 
effects are modeled in the X-12-ARIMA program and are permanently removed from 
the final seasonally adjusted series.



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Last Modified Date: June 21, 2013