Layoffs, Work, Mass, Outsourcing

Outsourcing accounts for small portion of mass layoffs in the US

16 Jun 2004 | (Survey)

Of the 182,456 workers who lost their jobs in extended mass layoffs for reasons other than seasonal during the first quarter of this year, 4,633 workers lost work because their companies outsourced the work outside of the country, according to a new study by the Bureau of Labor Statistics.

The study found that more workers lost their jobs because of domestic outsourcing than because of offshore outsourcing. Domestic outsourcing-- both within the company and to other companies--affected 9,985 workers.

The bureau began tracking outsourcing, which it calls movement or relocation of work, in January. The report only covers layoffs involving at least 50 workers where at least 50 people filed for unemployment insurance during a five-week period and the layoff lasted more than 30 days.

From January to March 2004, job loss associated with the relocation of work was reported in 119 layoff events, resulting in the separation of 16,021 workers. Events associated with movement of work accounted for about 14 percent of all layoff events and 9 percent of separations where the reason for the layoff was other than seasonal or vacation.

Three out of four events (90 out of 119) associated with movement of work occurred among establishments within the same company. In more than 7 out of 10 cases, the work activities were reassigned to places elsewhere in the U.S. In the 29 events in which work activities were reassigned to another company under contractual arrangements, half of the instances involved relocation of work outside the U.S. and half to companies within the U.S.

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