When a company lays someone off, the business does not have enough money or work to keep all its employees. The business is most likely trying to cut costs by cutting jobs.

Being laid off can be a temporary or permanent event. Layoffs don’t happen because of anything an employee did but because of events dealing with the business and employers. Some industries have more layoffs than others.

Types of Layoffs

Types of Layoffs

While there are various types of layoffs, this article looks at the four most common ones. A Mass Layoff is when a company lays off a large number of people at one time within a certain period.

A Temporary Layoff is when a person’s contract with a business is stopped for a specific length of time. These employees can be called back to work at any time if the business needs them. This type of layoff comes with a few benefits, like health insurance and compensatory pay.

A Permanent Layoff is when an employee has been laid off by the business on a permanent basis. There is no going back after a few months.

A Voluntary Layoff is when someone decides to stop working at a company of their own accord. It includes resigning and retiring. This could be because the employer asked them to or because the employee wants the severance package.

Industries with the Most Layoffs

In order to determine the industries with the highest layoff rates, you have to go to the report findings compiled by various sources. The top 15 industries with the most layoffs are listed below.

  1. Manufacturing.
  2. Wholesale Retail and Repair of Motor Vehicles.
  3. Professional, Scientific, and Technical Activities.
  4. Human Health and Social Work Activities.
  5. Information and Communication.
  6. Transport and Storage.
  7. Administrative and Support Services.
  8. Construction.
  9. Financial, Insurance, and Real Estate Activities.
  10. Other Services.
  11. Education.
  12. Accommodation and Food Services.
  13. Agriculture, Fishing, Energy, and Water.
  14. Public Admin and Defence.
  15. Social Security.

Reasons for Layoffs

There are various reasons why someone could be laid off by a business.

Cost Reduction

This is one of the foremost reasons for people being laid off. When a business no longer has enough money to pay an employee’s salary and benefits, the logical thing is to let that person go. This shortage of money can be the result of fewer profits or because there was not enough production. It is also possible that the company is trying to increase their profits by minimising its expenses, in other words, an employee’s salary and benefits.

Reasons for Layoffs

Mergers and Buyouts

A merger is when two existing businesses decide to get together and form one company together. A buyout is when one business buys another one to become part of the buying business. Due to the forming of these ‘new’ businesses, some positions, requirements, and job titles might not be necessary anymore. Employees get evaluated, and a decision is made if all of them are needed at the new business. If someone is not needed anymore, they are laid off.

Layoffs Due to Staff Redundancy

When some job titles are no longer needed, or some departments have too many people working there, some of the employees could get laid off. The business does not have any work for these people to do. Therefore, they are let go to save money. And because it is the logical step to take. This redundancy could be temporary or permanent, depending on the job position.

Company Relocation

When a company moves to a new location, it takes a lot of money to get everything sorted out and to figure out the new logistics and admin. It is also very expensive to move the current employees along with the business. Some people might be laid off. The business could also decide to hire an entirely new staff group from the new location, which would result in a mass layoff.

Outsourcing Employees

This is another popular reason for people getting laid off. Instead of permanently hiring employees and having to pay their salaries and all of their benefits, businesses hire temporary employees to work for them on a contract basis. These temporary employees work for contracting agencies that outsource them to businesses in need of specific skill sets for limited periods of time. When that contact employee’s work is completed, they simply go back to their agency instead of the business having to deal with laying them off.

Technological Advancement

Whereas this is usually a good thing, there are now many technological tools that can do the work of many people simultaneously. This makes human employees redundant for certain jobs. When it is cheaper to buy software and technology to do the work that is usually done by ten people, the smart business choice is to lay those people off in favour of the technology. As technology advances, it is taking over the jobs that are usually done by people. There are a lot of opinions regarding this development.

Changes in Job Positions


As new job titles and positions are created along with changing times, a lot of the previous job titles are no longer needed. Therefore, the people in those positions are no longer of use to businesses and are laid off. Some of these redundancies are temporary, while others are more permanent. Some companies provide their employees with the necessary courses and education to upgrade their skills, but they are not plentiful.


A cursory explanation is given about what being laid off means. The different types of layoffs are mentioned and explained. The 15 industries with the most layoffs are listed. Different reasons for layoffs are given and described.

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