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Sequester Cuts Federal Program That Tracks Layoffs

Ben Bradford

One of the fears about the federal budget cuts known as the sequester is that they could shrink the economy and trigger large layoffs. At the same time the government is cutting its program that tracks large layoffs—because of the sequester.

The Mass Layoff Statistics program is the government program that tracks what layoffs have happened, and why. It records when a company has laid off at least 50 people in five weeks. Then, staff go to companies and conduct interviews with employers for more information, such as what caused the layoffs (financial problems, off-shoring, or company restructuring, for instance). The data captured by the program is much more granular than your typical government unemployment report. The branch chief of the program, Scott Gibbons, says that’s even helped states mitigate damage from layoffs.

“A lot of states have found that this information is useful for rapid response, which is providing re-employment services for large numbers of unemployed people,” says Gibbons. “Some states even use it for some things like business development. If you’ve got a large pool of recently unemployed, that may be a labor pool that can be used as an incentive to employers coming in. And of course it’s of interest to the public and academics.”

Today the program releases its last monthly report. The Bureau of Labor Statistics is closing the program, after losing five percent of its budget—about $30 million—due to the sequester. The slow down in government spending from the sequester is also expected to accelerate job losses—exactly what the program is designed to track. Still, Gibbons says the government will continue to provide plenty of unemployment information.

“It’s just that none of those particular programs provide the level of detail that the Mass Layoff Statistic program was able to provide on these particular kind of events,” says Gibbons.