Displaced Workers Summary

Technical information:  (202) 691-6378     USDL 06-1454
               http://www.bls.gov/cps/
                                           For release:  10:00 A.M. EDT
Media contact:               691-5902      Thursday, August 17, 2006


    (Footnote 2 in table 7 was revised on Friday, September 15, 2006.)


                     WORKER DISPLACEMENT, 2003-2005
   
   
   During the January 2003 through December 2005 period, 3.8 million
workers were displaced from jobs they had held for at least 3 years, the
Bureau of Labor Statistics of the U.S. Department of Labor reported today.
The number of displaced workers decreased from 5.3 million in the previous
survey that covered the period from January 2001 through December 2003.
   
   Since 1984, the Employment and Training Administration of the U.S.
Department of Labor has sponsored surveys that collect information on
workers who were displaced from their jobs.  These surveys have been
conducted biennially as supplements to the Current Population Survey 
(CPS), a monthly survey of households that is the primary source of 
information on the nation's labor force.
   
   Displaced workers are defined as persons 20 years of age and older who
lost or left jobs because their plant or company closed or moved, there was
insufficient work for them to do, or their position or shift was abolished.
The period covered in this study was 2003-05, the 3 calendar years prior to
the January 2006 survey date.  The following analysis focuses primarily on
the 3.8 million persons who had worked for their employer for 3 or more years
at the time of displacement (referred to as long-tenured).  An additional 4.3 
million persons were displaced from jobs they had held for less than 3 years 
(referred to as short-tenured).  Combining the short- and long-tenured groups, 
the number of displaced workers totaled 8.1 million from 2003-05, down from 
11.4 million during the period covered by the prior survey (2001-03).
   
   Results from the January 2006 survey included the following highlights:
   
     --About 70 percent of the long-tenured displaced were reemployed at the
       time of the survey.
            
     --Just under half of long-tenured displaced workers cited plant or
       company closings or moves as the reason for their displacement.
         
     --Forty-five percent of displaced workers who had worked for their em-
       ployer for 3 or more years had received written advance notification 
       that their jobs would be terminated.  Those who had received advance 
       notice, however, were no more likely to be reemployed in January 2006 
       than were those who had not been notified.
           
     --About 28 percent of long-tenured displaced workers lost jobs in
       manufacturing.
           
     --About half of the long-tenured workers who were displaced from 
       full-time wage and salary jobs and who were reemployed in such jobs 
       had earnings that were as much or more than those on the lost job.  
       Twenty-nine percent experienced earnings losses of 20 percent or more.
   
                                  - 2 -

Characteristics of the Reemployed
   
   About 70 percent of the 3.8 million long-tenured displaced workers were
reemployed when surveyed in January 2006.  The proportion unemployed at the
time of the survey was 13 percent.  The remaining 17 percent of long-tenured 
displaced workers were not in the labor force.  (See table 1.)
   
   In January 2006, reemployment rates for workers ages 20 to 24 and those 
in the central-age group (ages 25 to 54) were 66 and 75 percent, respectively.  
Reemployment rates were slightly lower for older workers ages 55 to 64 (61 per-
cent).  Among those age 65 years and older, by contrast, only 25 percent were 
reemployed; 64 percent of that group were no longer in the labor force when 
surveyed.
   
   In January 2006, 74 percent of men who were displaced from their jobs were 
reemployed, compared with 66 percent of women.  Displaced men and women had 
about an equal likelihood of being unemployed, but the share of displaced women 
who had left the labor force, at about 21 percent, was higher than that for men--
13 percent.
   
   In January 2006, reemployment rates for whites (70 percent), blacks (71 per-
cent), and Asians (72 percent) were similar, while the rate for Hispanics was 
lower (60 percent).
   
Reason for Job Loss and Receipt of Advance Notice
   
   Of those long-tenured workers displaced during the January 2003 through
December 2005 period, 49 percent lost or left their jobs due to plant or
company closings or moves, 29 percent reported that their position or shift
was abolished, and 22 percent cited insufficient work as the reason for
being displaced.  (See table 2.)  The proportion of displaced workers
reporting plant closings or moves was up slightly from the prior survey,
and the share citing insufficient work was down.
   
   More than 4 in 10 long-tenured displaced workers received written advance 
notice that their jobs would be terminated, similar to the proportion in prior 
surveys.  In January 2006, those workers who lost jobs due to plant or company 
closings or moves and shift abolishment were most likely to have received writ-
ten advance notice of their impending job loss, at 53 and 48 percent, respec-
tively.  In comparison, only 25 percent of those who lost jobs due to insuffi-
cient work were notified in advance.  Regardless of the reason for displacement, 
receipt of written advance notice appears to have had little impact on the like-
lihood of being reemployed in January 2006.  Reemployment rates were little dif-
ferent for those who did and those who did not receive advance notice--69 and 71
percent, respectively.  (See table 3.)
   
Industry and Occupation
   
   As in prior surveys, manufacturing accounted for a disproportionately
large share of displaced workers.  During the 2003-05 period, 1.1 million
factory workers were displaced from their jobs--28 percent of all long-
tenured displaced workers.  Manufacturing displacements were again concen-
trated within the durable goods component (688,000), particularly in com-
puters and electronic products, primary metals and fabricated metal pro-
ducts, and transportation equipment.  (See table 4.)
   
   Displacements in wholesale and retail trade (508,000) accounted for 13
percent of all long-tenured workers displaced during the 2003-05 period.
Long-tenured displaced workers in professional and business services
(406,000) made up 11 percent of the total.
   
   The reemployment rate for displaced manufacturing workers was 65 percent, 
lower than the overall reemployment rate for displaced workers (70 percent).  
(Workers were not necessarily reemployed in the same industries from which 
they were displaced.)  Reemployment rates for workers displaced from jobs in 
the transportation and utilities industry and in the financial activities in-
dustry (77 percent each) were above average.
   
                                  - 3 -   
   
   In the January 2006 survey, persons displaced from managerial, professional, 
and related occupations accounted for 34 percent of all long-tenured displaced 
workers.  Sales and office occupations accounted for about one-quarter of the 
long-tenured worker displacements.  Workers in production, transportation, and 
material moving jobs made up about one-fifth of the long-tenured displaced; 
workers in these occupations tend to be employed in the manufacturing industry.  
(See table 5.)
   
   Among the major occupational groups, the reemployment rate was highest 
for workers displaced from management, professional, and related occupations 
(74 percent) and lowest for those displaced from production, transportation, 
and material moving occupations (63 percent).
   
Geographic Divisions
   
   The number of long-tenured workers displaced in each geographic division
in the United States was lower during the 2003-05 period than compared to
the prior survey.  The distribution of displacement among the divisions, 
however, was about the same as in the prior survey.  In January 2006, those
residing in the South Atlantic and Pacific divisions had the highest reem-
ployment rates; about three-quarters of the displaced in each of these divi-
sions were reemployed at the time of the survey.  (See table 6.)
   
Earnings
   
   Of the 2.4 million reemployed displaced workers who lost full-time wage
and salary jobs during the 2003-05 period, 2.0 million were working in such
jobs in January 2006.  Of these reemployed full-time workers who reported
earnings on their lost job, 51 percent were earning as much or more in
their new jobs as they had earned on the job they lost.  This was higher
than the proportion recorded in the January 2004 survey (43 percent).  In
January 2006, 29 percent reported earnings losses of 20 percent or more.
(See table 7.)
   
Total Displaced Workers (With No Tenure Restriction)
   
   The total number of workers displaced during the 2003-05 period (regardless 
of how long they had held their jobs) was about 8.1 million; the number of such 
workers during the 2001-2003 period was 11.4 million.  About two-thirds of the 
total displaced during the most recent period had found new jobs when surveyed 
in January 2006, while 16 percent were unemployed, and 16 percent were not in 
the labor force.  (See table 8.)
   
   Compared with long-tenured displaced workers, the short-tenured were more 
likely to be young and to have lost jobs in construction, in leisure and hospi-
tality, and in professional and business services.