54 Monthly Labor Review June 2004

Displaced Workers

As the economic expansion of the 1990s neared its peak,

both the incidence and likelihood of job loss remained low;

many displaced workers found new jobs, but earnings losses persisted

Ryan Helwig is an

economist in the

Division of Labor Force

Statistics, Bureau of

Labor Statistics.

e-mail:

Helwig.Ryan@bls.gov

Ryan Helwig

Displaced Workers

Worker displacement

in 1999–2000

The economic expansion that began in

1991 continued through 1999 and 2000,

peaking in March 2001, exactly 10 years

from the trough of the prior recession.1 During

1999 and 2000, nonfarm payroll employment

increased by 5.1 million jobs, and the national

unemployment rate fell to historic lows,

averaging 4.1 percent over the period.2 These

strong labor market conditions allowed the

incidence of job displacement to remain low.

The final years of the 1990s expansion

brought continued job and wage gains across

the economic spectrum, although job loss

remained a reality for many workers. During

the 1999–2000 period, 2.0 million persons

permanently lost jobs they had held for 3 or

more years because their plant or company

closed down or moved, their positions or shifts

were abolished, or there was insufficient work

for them to do. This level of displacement was

about the same as the 1.9 million reported

during the 1997–98 period. The displacement

rate—the proportion of long-tenured workers

who were displaced from their jobs—was 2.5

percent in 1999–2000, the same as the 1997–

98 rate. Despite the strongest labor market

witnessed since the inception of the survey in

1984, the displacement rate did not fall below

its all-time low of 2.4 percent from 1987–88.3

About three-fourths of long-tenured workers

who lost jobs in 1999–2000 were reemployed

when surveyed in January 2002.4 The median

time spent between jobs remained low, at 5.5

weeks. As a result, relatively few of these displaced workers were forced to rely on unemployment insurance to replace lost income.

The U.S. Department of Labor’s Employment

and Training Administration sponsors biennial

surveys of displaced workers as supplements to

the Current Population Survey (CPS). Using data

from the January 2002 supplemental survey, this

article examines job loss and reemployment,

focusing on characteristics of workers displaced

in 1999–2000 and their experiences following a

job loss. A time series has been constructed using

2 years of data from each survey, beginning with

the 1981–82 period (from the first survey in 1984)

and ending with the 1999–2000 period (from the

2002 survey). (See appendix for a description of

the Displaced Worker Survey.)

This article largely discusses long-tenured

workers—displaced workers who lost or left

jobs they had held for 3 or more years. The

basis for restricting the analysis to this subset

of workers is the assumption that at least 3 years

with the same employer denotes a solid

employment relationship. Long-tenured workers

are likely to have acquired firm-specific or

other specialized skills unique to their jobs. In

other words, displaced workers are more likely

to be those who lost jobs due to labor market

conditions—not as a result of a “bad match”

with their employer.

While this article focuses on individuals

displaced during 1999–2000, the full survey

reference period for the 2002 survey includes

2001. The onset of the recession in March 2001

certainly affected the level of job displacement

and the experience of job losers. Over the full

1999–2001 reference period, 4.0 million longtenured workers lost jobs. Indeed, about half

(2.0 million) were displaced during 2001 alone.5
Monthly Labor Review June 2004 55

Characteristics of the displaced

Age, sex, race, and Hispanic origin. The overall displacement

rate for persons aged 20 and older held at 2.5 percent in 1999–

2000. Displacement rates for men (2.4 percent), women (2.6

percent), and whites (2.5 percent) were essentially unchanged

from the prior survey. The rate for blacks edged up to 3.0

percent during the period. The displacement rate for Hispanics dropped slightly to 2.0 percent, the lowest rate

recorded for Hispanics in the two decades for which data are

available. (See table 1.) This low incidence of displacement

for Hispanics coincided with the lowest 2-year average

unemployment rate (6.1 percent) the group has experienced.

Educational attainment. Educational attainment often

determines an individual’s success in the labor market. In

general, individuals with more formal schooling have lower

unemployment rates and higher earnings than those who are

less educated. For example, among persons aged 20 and

older, the unemployment rate during 1999–2000 averaged 7.5

percent for high school dropouts, compared with 1.9 percent

for college graduates. Educational differences in displacement rates, however, are not as pronounced as those for

unemployment rates. As the following tabulation shows,

during 1999–2000, displacement rates were remarkably

similar across educational groups:

 Displacement rates

1997–98 1999–2000

Total, 20 years and older...................... 2.5 2.5

Less than a high school diploma ......... 2.5 2.4

High school graduate, no college ........ 2.5 2.5

Some college, no degree ...................... 2.9 2.9

Associate’s degree ................................ 2.6 3.0

College graduate .................................. 2.0 2.0

Industry and occupation. Displacement rates in some major

industries remained steady during the 1999–2000 period,

while in others, workers were more likely to be displaced.

Workers in goods-producing industries—mining, construction,

and manufacturing—continued to be affected more by

displacement than those in most service-producing industries.

Among goods-producing industries, construction posted

the lowest displacement rate (3.3 percent). In manufacturing,

the displacement rate rose to 4.7 percent. The increased

likelihood of displacement in 1999–2000 was felt in both

major component industries—durable and nondurable goods

manufacturing. (See table 2.)

Displacement rates of long-tenured workers by age, sex, race, and Hispanic origin, 1981–2000

[Percent]

 Characteristic 1981–82 1983–84 1985–86 1987–88 1989–90 1991–921 1993–94 1995–96 1997–98 1999–2000

 Total

Total, 20 years and older......................... 3.9 3.1 3.1 2.4 3.1 3.9 3.3 2.9 2.5 2.5

20 to 24 years ..................................... 4.0 2.0 1.8 2.0 2.2 2.0 2.5 1.9 1.7 1.7

25 to 54 years ..................................... 4.0 3.3 3.3 2.5 3.1 3.9 3.4 2.9 2.3 2.5

25 to 34 years ................................ 5.0 3.9 3.5 2.5 3.1 3.9 3.5 2.9 2.2 2.3

35 to 44 years ................................ 3.8 3.1 3.3 2.7 3.2 4.0 3.4 3.0 2.4 2.5

45 to 54 years ................................ 3.0 2.6 3.0 2.2 3.1 3.9 3.4 3.0 2.4 2.6

55 years and older .............................. 3.6 3.1 2.9 2.2 3.1 4.4 3.1 3.3 3.1 2.6

55 to 64 years ................................ 3.8 3.1 3.0 2.3 3.3 4.5 3.0 3.3 3.2 2.7

65 years and older ......................... 3.2 2.9 2.3 1.9 2.4 3.8 3.2 3.5 2.9 2.1

Men, 20 years and older..................... 4.3 3.2 3.3 2.4 3.2 4.1 3.4 2.8 2.4 2.4

Women, 20 years and older ............... 3.4 2.9 2.8 2.4 2.8 3.5 3.2 3.2 2.5 2.6

 White

Total, 20 years and older......................... 3.8 3.1 3.1 2.4 3.0 3.8 3.3 3.0 2.5 2.5

Men ..................................................... 4.2 3.2 3.3 2.4 3.2 4.1 3.4 2.8 2.4 2.4

Women ............................................... 3.3 2.9 2.8 2.4 2.8 3.4 3.2 3.2 2.6 2.6

 Black

Total, 20 years and older......................... 4.8 3.9 3.4 2.0 3.5 3.8 3.5 2.7 2.3 3.0

Men ..................................................... 5.3 4.0 4.1 1.6 3.9 3.9 4.2 2.6 2.6 3.1

Women ............................................... 4.3 3.8 2.6 2.4 3.2 3.7 2.9 2.8 2.0 2.9

 Hispanic origin

Total, 20 years and older......................... 4.3 3.9 3.9 2.9 4.3 4.7 3.6 4.0 3.1 2.0

Men ..................................................... 4.3 3.9 4.1 2.6 4.1 5.2 3.9 3.2 2.7 1.2

Women ............................................... 4.4 3.8 3.5 3.3 4.7 3.8 3.1 5.3 3.7 3.4

1

 Data, beginning with the 1991–92 period, are not directly comparable

with earlier periods due to differences in estimation methodology.

NOTE: Displacement rates are calculated by dividing the number of

displaced workers in a specified worker group by a tenure-adjusted, 2-year

average estimate of employment for the same worker group. Employment

estimates for each year were adjusted, using job-tenure data from the

January 1983, 1987, 1991, and February 1996, 1998, and 2000 CPS

supplements, to include only those workers with 3 years of tenure or more.

A 2-year average was then computed using those adjusted employment

estimates.

Table 1.
56 Monthly Labor Review June 2004

Displaced Workers

Displacement rates of long-tenured workers by industry, class of worker, and occupation of lost job, 1981–2000

[Percent]

 Characteristic 1981–82 1983–84 1985–86 1987–88 1989–90 1991–921 1993–94 1995–96 1997–98 1999–2000

Total, 20 years and older .................... 3.9 3.1 3.1 2.4 3.1 3.9 3.3 2.9 2.5 2.5

 Industry and class of worker

Nonagricultural private wage and salary

workers .................................................. 5.3 4.2 4.3 3.2 4.1 5.1 4.4 3.8 3.2 3.3

Mining ................................................. 13.6 9.2 17.8 6.1 10.0 7.4 7.2 4.5 10.1 7.5

Construction ....................................... 7.6 5.5 7.0 4.2 5.9 8.4 4.3 3.4 3.4 3.3

Manufacturing ..................................... 8.2 6.5 5.2 3.9 5.0 7.1 5.8 5.1 4.2 4.7

Durable goods ................................ 9.3 7.0 5.8 4.0 5.1 8.4 6.3 4.6 4.3 4.7

Nondurable goods .......................... 6.4 5.6 4.1 3.7 4.9 5.2 5.1 5.8 4.1 4.8

Transportation and public utilities ....... 4.1 3.8 3.1 1.8 3.6 4.4 4.3 3.8 2.5 2.7

Wholesale and retail trade ................. 3.7 3.1 4.3 3.6 3.9 4.7 4.6 4.3 3.4 3.1

Finance, insurance, and real estate ... 1.4 1.3 3.5 2.8 3.5 5.5 4.7 3.5 3.3 3.7

Services .............................................. 2.3 2.1 2.3 1.7 2.1 2.9 2.8 2.5 2.2 2.5

Agricultural wage and salary workers ..... 5.4 9.7 4.1 2.5 3.2 3.8 3.4 2.2 4.0 1.7

Government workers ............................... 1.2 .6 .4 .4 .4 1.1 1.3 1.4 .7 .5

 Occupation

 White-collar occupations2 ....................... 2.6 2.1 2.6 2.1 2.7 3.7 3.3 2.9 2.4 2.4

Managerial and professional specialty ... 2.1 1.8 2.1 1.8 2.3 3.6 2.9 2.3 2.3 2.1

Executive, administrative, and

managerial ........................................ 2.5 2.4 2.8 2.5 3.4 4.8 3.5 2.7 2.9 2.7

Professional specialty ........................ 1.7 1.2 1.4 1.1 1.3 2.4 2.4 2.0 1.6 1.6

 Technical, sales, and administrative

 support .................................................. 3.0 2.4 3.1 2.5 3.1 3.7 3.7 3.6 2.5 2.7

Technicians and related support ........ 3.3 2.9 3.0 2.2 3.2 3.7 3.4 3.6 2.5 2.7

Sales occupations .............................. 3.7 2.8 3.2 2.7 2.9 3.6 3.4 3.8 2.7 2.9

Administrative support, including

clerical .............................................. 2.5 2.0 3.1 2.4 3.2 3.8 3.9 3.5 2.3 2.6

 Service occupations ............................... 2.0 1.8 1.9 1.5 1.6 2.1 1.8 2.1 1.4 1.4

Protective services ............................. 1.3 1.9 .5 .6 1.2 .8 0.6 2.0 .8 .9

 Other service occupations ................. 2.1 1.7 2.2 1.6 1.7 2.3 2.1 2.2 1.6 1.6

 Blue-collar occupations3 ......................... 7.3 5.7 4.7 3.3 4.5 5.3 4.2 3.5 3.1 3.3

 Precision production, craft, and repair ... 6.2 4.5 3.9 2.7 4.2 5.1 3.4 3.1 2.7 2.8

Mechanics and repairers .................... 4.8 3.8 2.1 2.1 3.4 3.7 3.3 3.1 2.0 2.1

Construction trades ............................ 5.3 4.0 4.1 2.4 4.2 5.5 2.2 2.4 2.8 1.6

Other precision production

occupations ...................................... 8.5 5.6 5.5 3.7 5.1 6.4 4.7 3.8 3.6 5.1

 Operators, fabricators, and laborers ...... 8.2 6.7 5.5 3.8 4.8 5.5 5.0 3.8 3.5 3.7

Machine operators, assemblers, and

inspectors ......................................... 9.6 8.1 5.9 4.5 6.2 6.7 5.5 4.9 4.0 4.8

Transportation and material moving

occupations ...................................... 5.7 3.7 4.8 3.1 3.6 4.1 4.1 2.1 2.1 3.0

Handlers, equipment cleaners, helpers,

and laborers ..................................... 8.0 7.6 5.2 3.0 3.0 4.9 5.4 3.9 4.3 2.7

Farming, forestry, and fishing ................. .9 2.1 1.6 .8 1.5 1.4 .8 1.4 1.8 .5

Table 2.

1 Data beginning with the 1991–92 period are not directly comparable with

earlier periods due to differences in estimation methodology.

2 White-collar occupations are made up of the “managerial and

professional specialty” and “technical, sales, and administrative support”

categories.

3 Blue-collar occupations are the sum of the “precision production, craft,

and repair” and “operators, fabricators, and laborers” categories.

NOTE: Displacement rates are calculated by dividing the number of

displaced workers in a specified worker group by a tenure-adjusted, 2-year

average estimate of employment for the same worker group. Employment

estimates for each year were adjusted, using job-tenure data from the

January 1983, 1987, 1991, and February 1996, 1998, and 2000 Current

Population Survey (CPS) supplements, to include only those workers with 3

years of tenure or more. A 2-year average was then computed using those

adjusted employment estimates.
Monthly Labor Review June 2004 57

In the service-producing industries, displacement rates

were up to 3.7 percent in finance, insurance, and real estate

and up to 2.5 percent in services. The services industry, however, continued to have the lowest displacement rate among

nonagricultural industries in the private sector.

 In the early 1980s, displacement among blue-collar

workers was significantly higher than among their white-collar

counterparts.6 Over the past 2 decades, however, the difference in displacement rates for these two groups has

narrowed. In 1999 and 2000, blue-collar workers again had a

higher rate of job loss (3.3 percent) compared with whitecollar workers (2.4 percent).

Tenure on the lost job. During the 1999–2000 period, 4.7

million workers were displaced, regardless of their tenure on

the lost job. Nearly three-fifths of these displaced workers

had less than 3 years of tenure before losing their job. As in

prior displacement surveys, long-tenured workers were

generally less likely to lose a job. (See table 3.)

The displacement rate for those with less than 3 years of experience with their employer was 5.3 percent—more than twice

the rate for their more experienced counterparts (2.5 percent).

The job loss rate during 1999–2000 was lowest (1.6 percent) for

workers who had tenure of 20 years or more with their employer.

The displacement experience

Reason for job loss. About one-half of the 2.0 million longtenured workers displaced during 1999–2000 lost their job

because their plant or company closed or moved. As in prior surveys, plant or company closings contributed the most to worker

displacement. About 3 in 10 workers reported their position or

shift had been abolished. The remaining 20 percent of displaced

workers cited insufficient work for their lost job. (See table 4.)

These proportions have changed little across recent surveys.

Displaced workers with less education were more likely to

cite plant or company closings as the reason for losing their

job in 1999 or 2000. By contrast, displaced college graduates

more often attributed job losses to having their position

abolished. Research conducted by Henry S. Farber shows an

increase in the share of more-educated displaced workers who

cited a position or shift abolishment as the reason for job loss

during the 1990s.7

 Farber finds this consistent with reports of

significant job loss among white-collar workers during the

early and mid-1990s.

Weeks without work. Displaced workers who found a new

job were asked how long they went without work. The strong

labor market of 1999 and 2000 again kept the duration of job

search relatively low. In the 2002 survey, the median period

between jobs for these 1.6 million displaced workers was 5.5

weeks, little changed from the prior survey. (See table 5.)

Other findings from the 2002 survey show that displaced

workers aged 55 and older spent the most time without work—

7.2 weeks, 2 weeks more than their counterparts aged 25–54.

The median duration for women (7.7 weeks) was longer than

that for men (4.1 weeks).

Displaced workers with more education typically spent less

time without a job than those with less education. College graduates spent 5.6 weeks without a job, compared with a median

10.5 weeks for displaced workers without a high school diploma.

Long-tenured displaced workers in construction and in

transportation and public utilities spent the least time between

jobs—2.2 weeks and 2.3 weeks, respectively. By contrast,

displaced workers whose last job was in finance, insurance, or

real estate were without work for the longest median duration—

8.2 weeks. Workers displaced from manufacturing jobs spent

a median 6.5 weeks without work. In manufacturing and in

finance, insurance, and real estate, nearly one-third of displaced

workers spent 15 or more weeks without work. (See table 6.)

Displacement rates by tenure on the lost job, 1981–2000

[Percent]

 Tenure on the lost job 1981–82 1983–84 1985–86 1987–88 1989–90 1991–921 1993–94 1995–96 1997–98 1999–2000

Total displaced, age 20 years and older .... 5.7 4.1 4.0 3.2 4.3 4.9 4.4 3.9 3.4 3.7

Less than 3 years .................................. 8.9 5.7 5.4 4.7 6.5 6.6 6.5 5.5 5.0 5.3

 3 years or more ..................................... 3.9 3.1 3.1 2.4 3.1 3.9 3.3 2.9 2.5 2.5

 3 to 4 years ......................................... 5.8 4.3 4.0 3.5 4.4 5.7 5.0 3.7 3.1 3.2

 5 to 9 years ......................................... 4.4 3.5 3.6 2.6 3.3 4.3 3.2 3.3 2.5 2.8

 10 years or more ................................. 2.6 2.2 2.3 1.7 2.2 2.8 2.5 2.3 2.1 1.9

 10 to 14 years ................................... 3.1 2.7 2.6 1.9 2.5 3.0 2.6 2.4 2.0 1.9

 15 to 19 years ................................... 2.5 2.1 2.2 1.6 2.5 2.7 2.5 2.5 2.4 2.2

20 years or more .............................. 2.0 1.7 2.1 1.5 1.7 2.7 2.4 2.1 1.9 1.6

Table 3.

1 Data, beginning with the 1991–92 period, are not directly comparable

with earlier periods due to differences in estimation methodology.

 NOTE: Displacement rates are calculated by dividing the number of

displaced workers in a specified worker group by a tenure-adjusted, 2-year

average estimate of employment for the same worker group. Employment

estimates for each year were adjusted, using job-tenure data from the

January 1983, 1987, 1991, and February 1996, 1998, and 2000 Current

Population Survey (CPS) supplements.
58 Monthly Labor Review June 2004

Displaced Workers

Long-tenured displaced workers who found new jobs by weeks without work, age, sex, educational attainment,

and employment status in January 2002

Total, 20 years and older.................... 1,604 785 360 225 170 64 5.5

25 to 54 years ................................. 1,336 656 306 202 135 37 5.2

25 to 34 years ............................. 311 136 84 56 30 5 6.6

35 to 44 years ............................. 549 281 136 63 52 17 4.3

45 to 54 years ............................. 474 238 86 83 53 14 4.5

55 years and older .......................... 230 107 43 21 32 27 7.2

Employed ........................................ 1,433 713 315 209 149 47 4.7

Unemployed .................................... 104 41 24 12 17 10 8.3

Not in the labor force ....................... 68 31 21 4 5 7 (1

)

 Men

 Men, 20 years and older .................. 883 467 207 100 80 29 4.1

Employed .................................... 795 424 186 88 71 26 4.0

Unemployed ............................... 57 26 10 11 9 1 (1

)

Not in the labor force .................. 29 16 11 0 0 2 (1)

 Women

 Women, 20 years and older ............. 720 318 153 125 90 34 7.7

Employed .................................... 636 288 129 120 78 21 7.2

Unemployed ............................... 45 14 14 1 7 9 (1

)

Not in the labor force .................. 38 15 10 4 5 4 (1

)

 Educational attainment

Less than a high school diploma ......... 109 38 36 23 6 6 10.5

High school graduates, no college ...... 505 260 116 59 53 17 4.4

Some college, no degree .................... 371 183 74 50 46 18 4.8

Associate’s degree .............................. 177 83 48 19 25 2 5.8

Bachelor’s degree ................................ 315 153 60 58 31 13 5.6

Advanced degree ................................. 126 67 26 16 9 8 4.0

Characteristic

Less than

5 weeks

Median weeks

without work

Table 5.

27 to 52

weeks

Total who

found jobs

(in thousands)

Weeks without work before finding a job

52 weeks

or more

5 to 14

weeks

15 to 26

 weeks

1 Data not shown where base is less than 75,000.

NOTE: Data refer to persons who had 3 or more years of tenure on a job

they had lost or left between January 1999 and December 2000 because

their plant or company closed or moved, there was insufficient work for

them to do, or their positions or shifts were abolished.

Long-tenured displaced workers who lost jobs in 1999 or 2000, by age, sex, educational attainment, and reason

for job loss

Total, 20 years and older................................................. 2,005 52.1 18.8 29.2

20 to 24 years .............................................................. 50 (1

) (1) (1)

25 to 54 years .............................................................. 1,584 51.8 18.9 29.4

25 to 34 years .......................................................... 352 56.0 16.2 27.8

35 to 44 years .......................................................... 639 50.5 21.9 27.5

45 to 54 years .......................................................... 593 50.6 17.2 32.2

55 years and older ....................................................... 371 51.2 16.4 32.3

55 to 64 years .......................................................... 303 52.8 13.9 34.0

65 years and older ................................................... 68 (1

) (1) (1)

Men, 20 years and older ................................................. 1,071 48.5 20.3 31.3

Women, 20 years and older ............................................ 933 56.2 17.0 26.8

 Educational attainment

Less than a high school diploma .................................... 176 59.8 27.5 12.7

High school graduates, no college .................................. 665 55.0 24.4 20.6

Some college, no degree ................................................ 450 55.9 14.5 29.6

Associate’s degree .......................................................... 218 52.0 17.4 30.6

Bachelor’s degree ........................................................... 345 42.2 14.2 43.6

Advanced degree ............................................................ 150 41.2 8.6 50.1

1 Data not shown where base is less than 75,000.

NOTE: Data refer to persons who had 3 or more years of tenure on a job

they had lost or left between January 1999 and December 2000 because

Age, sex, and educational attainment Displaced workers

(in thousands)

Percent distribution

Plant or company

closed down

or moved

Insufficient work Position or shift

abolished

their plant or company closed or moved, there was insufficient work for them

to do, or their positions or shifts were abolished.

Table 4.
Monthly Labor Review June 2004 59

Both proportions are the lowest recorded since the

inception of the Displaced Worker Supplement in the early

1980s. (See table 7.) This lower incidence of UI receipt

reflects the relatively few weeks that most displaced

workers went without work and a high reemployment rate.

As one would expect, displaced workers who spent more

time between jobs were more reliant upon unemployment

insurance and more likely to exhaust their benefits. Over

two-thirds of those who spent a year or more between their

old and new jobs exhausted their benefits. (See table 8.)

Receipt of unemployment insurance. The receipt of

unemployment insurance (UI) among displaced workers over

the last 2 decades appears cyclical, varying with the economy’s overall condition. With the economic expansion of

the 1990s entering its 9th and 10th consecutive years in 1999

and 2000, relatively few displaced workers used UI.

About 45 percent of the 2.0 million long-tenured

displaced workers in 1999–2000 used UI to replace some

lost income following job loss, and one-fifth of those who

received UI reported they had exhausted their benefits.

Long-tenured displaced workers who found new jobs by weeks without work, industry, class of worker, and

occupation of the lost job

Total, 20 years and older ..................... 1,604 785 360 225 170 64 5.5

 Industry and class of worker

Nonagricultural private wage and salary

workers ............................................. 1,522 732 353 214 162 61 5.7

Mining .............................................. 19 6 4 5 0 4 (1

)

Construction .................................... 99 62 22 9 4 2 2.2

Manufacturing ................................. 466 209 113 71 50 23 6.5

 Durable goods ............................. 272 132 69 34 32 5 5.2

 Nondurable goods ....................... 194 77 44 36 18 19 9.9

Transportation and public utilities ... 101 55 13 18 15 0 2.3

Wholesale trade .............................. 108 58 14 11 13 12 4.2

Retail trade ...................................... 207 96 53 20 31 7 6.1

Finance, insurance, and real estate .. 154 66 38 32 13 5 8.2

Services .......................................... 371 181 96 50 37 7 5.0

 Professional services .................. 170 87 46 16 18 3 4.4

Agricultural wage and salary workers .... 7 4 1 0 0 2 (1

)

Government workers ........................... 63 45 5 11 2 0 (1)

 Occupation

Managerial and professional specialty 493 224 125 75 53 16 6.2

Executive, administrative, and

managerial .................................... 311 122 88 61 26 14 7.8

Professional specialty ..................... 184 102 38 15 27 2 3.6

Technical, sales, and administrative

support ............................................. 510 251 112 61 65 21 5.0

Technicians and related support ..... 58 31 17 6 0 4 (1

)

Sales occupations ........................... 213 105 41 32 22 13 5.7

Administrative support, including

clerical ......................................... 240 115 54 23 43 5 5.1

Service occupations ............................ 88 45 27 9 5 2 4.4

Protective services .......................... 14 5 6 0 3 0 (1

)

Other service occupations .............. 73 40 20 9 2 2 (1

)

Precision production, craft, and

repair ................................................ 214 108 47 29 24 6 4.4

Mechanics and repairers ................ 61 27 8 10 14 2 (1

)

Construction trades ......................... 50 37 6 6 1 0 (1)

Other precision production

occupations ................................. 103 45 32 13 9 4 6.0

Operators, fabricators, and laborers ... 281 151 44 50 20 16 3.9

Machine operators, assemblers,

and inspectors ............................. 160 75 21 35 14 15 8.4

Transportation and material moving

occupations ................................. 79 59 11 2 6 1 1.6

Handlers, equipment cleaners,

helpers, and laborers .................. 41 16 12 13 0 0 (1

)

Farming, forestry, and fishing ............ 4 1 1 0 0 2 (1

)

Characteristic

Less than

5 weeks

Median weeks

without work

27 to 52

weeks

Total who

found jobs

(in thousands)

Weeks without work before finding a job

52 weeks

or more

5 to 14

weeks

15 to 26

 weeks

1 Data not shown where base is less than 75,000.

NOTE: Data refer to persons who had 3 or more years of tenure on a job

they had lost or left between January 1999 and December 2000 because

Table 6.

their plant or company closed or moved, there was insufficient work

for them to do, or their positions or shifts were abolished.
60 Monthly Labor Review June 2004

Displaced Workers

Loss of health insurance. Many workers rely on employerprovided health insurance coverage. As a result, those who

lose or leave a job may experience a period without health

insurance. Nearly 3 in 4 workers displaced during 1999–2000

had been covered by an employer-provided health plan on

the job they lost. (See table 9.)

Among displaced workers whose health insurance had

been provided by their employer, 80 percent were covered by

some group health insurance plan in January 2002.8

 The

likelihood of having health insurance at the time of the survey

largely depended on the employment status of displaced

workers. About 86 percent of those employed in January 2002

had group health insurance, compared with only 48 percent

of those who were unemployed. The coverage rate for unemployed persons was much lower than that recorded in the 2000

survey.

After displacement

Employment status. The reemployment rate—the proportion

of long-tenured displaced workers employed at the time of

the survey—was 74 percent in January 2002, about the same

NOTE: Data refer to persons who had 3 or more years of tenure on a

job they had lost or left during the survey reference period because their

plant or company closed or moved, there was insufficient work for them to

do, or their positions or shifts were abolished.

Characteristic

1981–82

Displaced

workers Percent Displaced

workers

Displaced

workers Percent Displaced

workers Percent

[Numbers in thousands]

Displaced

workers Percent Percent

Long-tenured displaced workers by receipt and exhaustion of unemployment insurance benefits and

employment status at the time of the survey

Table 7.

1983–84 1985–86 1987–88 1989–90

Total, 20 years and

older ........................... 2,361 100.0 1,920 100.0 1,996 100.0 1,623 100.0 2,192 100.0

Received benefits1 .. 1,725 73.1 1,223 63.7 1,239 62.1 929 57.2 1,301 59.4

Exhausted

 benefits ............. 980 41.5 (2

) (2) 668 33.5 451 27.8 733 33.4

Employed ................... 1,517 100.0 1,363 100.0 1,533 100.0 1,278 100.0 1,600 100.0

Received benefits ... 1,072 70.7 851 62.4 931 60.7 701 54.9 902 56.4

Exhausted

benefits ............. 469 30.9 (2) (2) 443 28.9 277 21.7 424 26.5

Unemployed ............... 480 100.0 240 100.0 192 100.0 124 100.0 293 100.0

Received benefits ... 405 84.4 176 73.3 146 76.0 88 71.0 210 71.7

Exhausted

benefits ............. 326 67.9 (2

) (2) 105 54.7 60 48.4 161 54.9

Not in the labor force ... 364 100.0 317 100.0 271 100.0 221 100.0 299 100.0

Received benefits ... 248 68.1 196 61.8 162 59.8 140 63.3 189 63.2

Exhausted

benefits ............. 185 50.8 (2

) (2) 120 44.3 114 51.6 148 49.5

1991–92 1993–94 1995–96 1997–98 1999–2000

Displaced Displaced Displaced Displaced Displaced

 workers workers workers workers workers

Total, 20 years and

older ........................ 2,816 100.0 2,445 100.0 2,238 100.0 1,920 100.0 2,005 100.0

Received benefits1 .. 1,746 62.0 1,302 53.3 1,142 51.0 883 46.0 897 44.7

Exhausted

 benefits ............. 878 31.2 687 28.1 619 27.7 437 22.8 419 20.9

Employed ................... 2,113 100.0 1,920 100.0 1,846 100.0 1,496 100.0 1,487 100.0

Received benefits ... 1,267 60.0 1,002 52.2 911 49.3 636 42.5 613 41.2

Exhausted

benefits ............. 499 23.6 468 24.4 448 24.3 251 16.8 233 15.7

 Unemployed .............. 313 100.0 177 100.0 114 100.0 108 100.0 210 100.0

Received benefits ... 241 77.0 117 66.1 74 64.9 75 69.4 118 56.2

Exhausted

benefits ............. 185 59.1 79 44.6 43 37.7 52 48.1 79 37.6

 Not in the labor force . 390 100.0 348 100.0 278 100.0 316 100.0 308 100.0

Received benefits ... 238 61.0 183 52.6 157 56.5 172 54.4 166 53.9

Exhausted

benefits ............. 194 49.7 140 40.2 128 46.0 134 42.4 107 34.7

 Percent Percent Percent Percent Percent

 1 Data will not sum to totals or 100 percent because the numbers of

displaced workers who reported that they did not receive benefits or did not

answer are not shown separately. 2 Data not available.
Monthly Labor Review June 2004 61

 Table 9.

their plant or company closed or moved, there was insufficient work for

them to do, or their positions or shifts were abolished.

Long-tenured displaced workers by receipt and exhaustion of unemployment insurance benefits, and weeks

without work before finding a new job, 1999–2000

 Total who found jobs ...................................................... 1,593 42.2 17.1 57.7

 Less than 5 weeks .......................................................... 781 16.4 4.9 83.6

 5 to 14 weeks ................................................................. 355 58.2 6.9 41.8

 15 to 26 weeks ............................................................... 223 68.1 27.3 31.9

 27 to 51 weeks ............................................................... 102 86.0 59.0 14.0

 52 weeks or more .......................................................... 131 75.6 67.2 24.4

Weeks without work Total

(in thousands)

Percent distribution

Did not receive

unemployment

Total Exhausted benefits insurance

Table 8.

Received benefits

NOTE: Data refer to persons who had 3 or more years of tenure on a job

they had lost or left between January 1999 and December 2000 because

Long-tenured displaced workers by incidence of group health insurance coverage on lost and current job, and

by sex, race, Hispanic origin, and employment status in January 2002

Total, 20 years and older................................................. 2,005 1,457 79.7 20.0 537

 Employed ...................................................................... 1,487 1,108 85.6 14.0 372

 Unemployed .................................................................. 210 146 47.9 52.1 60

 Not in the labor force .................................................... 308 203 69.5 29.6 105

Men, 20 years and older ................................................. 1,071 795 82.8 17.0 266

 Employed ...................................................................... 824 625 88.6 11.2 192

 Unemployed .................................................................. 130 90 51.1 48.9 35

 Not in the labor force .................................................... 118 80 71.3 26.3 38

Women, 20 years and older ............................................ 933 662 76.0 23.6 271

 Employed ...................................................................... 663 483 81.8 17.6 180

 Unemployed .................................................................. 80 56 (2) (2) 25

 Not in the labor force .................................................... 190 123 68.3 31.7 67

 White3

Total, 20 years and older................................................. 1,678 1,226 80.5 19.1 441

 Men ............................................................................... 907 679 83.9 15.8 217

 Women .......................................................................... 770 547 76.4 23.0 223

 Black3

Total, 20 years and older .................................................. 261 177 78.0 22.0 84

 Men ............................................................................... 128 88 80.7 19.3 39

 Women .......................................................................... 134 89 75.3 25.8 44

 Hispanic origin3

Total, 20 years and older .................................................. 152 80 73.8 27.5 72

 Men ............................................................................... 53 27 (2) (2) 26

 Women .......................................................................... 99 53 (2) (2) 46

Characteristic Total

(in thousands)

Not covered

on lost job

Covered by a group health

insurance plan on lost job(1)

Total

(in thousands)

Percent covered by any

group health insurance

plan in January 2002

Yes No

1 Health insurance coverage excludes Medicare or Medicaid. Detail will

not sum to totals or 100 percent because a small number of respondents did

not know about their coverage on their past and/or current job.

2 Data not shown where base is less than 75,000.

3 Detail for the above race and Hispanic-origin groups will not sum to

totals because data for the “other races” group are not presented, and

Hispanics are included in both the white and black population groups.

NOTE: Data refer to persons who had 3 or more years of tenure on a job

they had lost or left between January 1999 and December 2000 because

their plant or company closed or moved, there was insufficient work for them

to do, or their positions or shifts were abolished.
62 Monthly Labor Review June 2004

Displaced Workers

as in the prior survey. The share of displaced workers who

were unemployed when surveyed was nearly 11 percent,

almost double the proportion measured in the 2000 survey.

(See table 10.)

Overall, labor market conditions were weak in January

2002 following the recession that ended in November 2001.9

The employment-population ratio declined from 64.3 percent

when the recession began in March 2001 to 62.7 percent in

January 2002. The national unemployment rate rose from

4.3 percent to 5.6 percent over the same period. Thus, at the

time of the survey, displaced workers faced a labor market

characterized by significantly diminished labor demand.

Compared with the prior (Feb. 2000) survey, displaced

workers across the major demographic groups experienced

declines in reemployment rates and increased likelihood of

unemployment when surveyed in January 2002. Men were

again more likely than women to be reemployed. The

reemployment rate for men was 77 percent, compared with

71 percent for women. Blacks and Hispanics who had lost

jobs during 1999 or 2000 had similar reemployment rates in

January 2002, about 69 percent and 70 percent, respectively.

The reemployment rate for blacks was down nearly 18

percentage points from the 2000 survey; the rate for Hispanics

was down 7 percentage points. The proportions of black and

Hispanic job losers who were unemployed in January 2002

increased significantly to 14 and 18 percent, respectively.

Older displaced workers were most likely to have left the

labor force following displacement. Among displaced workers

aged 55 and older, 35 percent were not in the labor force.

Following a job loss, this exit from the labor force among many

older individuals likely reflects a decision to retire.10

Moving to another area. After losing a job, some displaced

workers move to another area to search for work or to take

another job. Among long-tenured workers displaced during

1999 or 2000, only 8 percent had moved for one of these

reasons. Overall, those who moved to find work had the same

reemployment rate as those who did not move. (See table 11.)

The new jobs

Switching industries and occupations. To find work following

job loss, many displaced workers enter a new industry or pursue

an entirely new line of work. One-half of all long-tenured

workers displaced in 1999 or 2000 and reemployed in January

2002 had switched to a new major industry. (See table 12.)

55 years and older ....................................................... 371 56.8 8.2 35.0

55 to 64 years .......................................................... 303 64.4 7.6 27.7

65 years and older ................................................... 68 (1

) (1) (1)

Men, 20 years and older ................................................. 1,071 76.9 12.1 11.0

Women, 20 years and older ............................................ 933 71.0 8.6 20.4

 White2

Total, 20 years and older................................................. 1,678 75.1 9.8 15.1

 Men ............................................................................... 907 78.8 11.2 10.0

 Women .......................................................................... 770 70.7 8.1 21.2

 Black2

Total, 20 years and older................................................. 261 68.7 14.3 17.0

 Men ............................................................................... 128 66.2 15.1 18.6

 Women .......................................................................... 134 71.1 13.5 15.4

 Hispanic origin2

Total, 20 years and older................................................. 152 69.6 18.2 12.2

 Men ............................................................................... 53 (1) (1) (1)

 Women .......................................................................... 99 67.4 15.1 17.5

Long-tenured displaced workers by age, sex, race, Hispanic origin, and employment status in January 2002

Total, 20 years and older................................................. 2,005 74.2 10.5 15.4

20 to 24 years .............................................................. 50 (1

) (1) (1)

25 to 54 years .............................................................. 1,584 78.4 11.1 10.5

25 to 34 years .......................................................... 352 80.2 9.3 10.6

35 to 44 years .......................................................... 639 79.8 12.0 8.2

45 to 54 years .......................................................... 593 75.8 11.2 13.0

Characteristic Displaced workers

(in thousands)

Percent distribution by employment status in January 2002

Not in the

labor force Employed Unemployed

1 Data not shown where base is less than 75,000.

2 Detail for the above race and Hispanic-origin groups will not sum to totals

because data for the “other races” group are not presented, and Hispanics

are included in both the white and black population groups.

NOTE: Data refer to persons who had 3 or more years of tenure on a

job they had lost or left between January 1999 and December 2000 because

their plant or company closed or moved, there was insufficient work for

them to do, or their positions or shifts were abolished.

 Table 10.
Monthly Labor Review June 2004 63

Industry switching varies across the major sectors.

Workers displaced from jobs in construction and in the

services industry were most likely to be reemployed in the

same industry. In fact, about two-thirds of those who lost

jobs in services were reemployed in that same industry when

surveyed in 2002. By contrast, only one in five workers

displaced from jobs in the wholesale trade industry remained

in that sector upon reemployment.

Employment growth during 1999 and 2000 was concentrated in the service sector.11 Employment in the services

industry increased by 4.0 million during this period. Onethird of all reemployed displaced workers were employed in

the services industry in January 2002.

Displaced workers are less likely to switch their occupation

following job loss than they are to change industries. Sixty

percent of these reemployed individuals worked in the same

major occupational group in January 2002. (See table 13.)

Across different industries, many occupations require specific

knowledge or skills, leading many who have lost jobs to

search for work in a similar occupation. Displaced whitecollar workers are more likely to stay in the same occupation

than blue-collar workers—64 versus 53 percent, respectively.

Among the 1.5 million long-tenured workers who lost jobs

in 1999 or 2000 and who were reemployed in January 2002,

Long-tenured displaced workers by age, sex, and whether they moved to a different city or county to find or

take another job, January 2002

 Total

Total, 20 years and older ................................... 1,847 1,370 74.2 158 117 74.1

 25 to 54 years .................................................. 1,449 1,143 78.9 135 99 73.3

 55 years and older ........................................... 357 202 56.6 14 9 (1

)

 Men

Total, 20 years and older ................................... 967 743 76.8 105 81 77.1

 25 to 54 years .................................................. 776 631 81.3 96 73 76.0

 55 years and older ........................................... 177 104 58.8 8 8 (1)

 Women

Total, 20 years and older ................................... 880 627 71.3 53 36 (1

)

 25 to 54 years .................................................. 673 511 75.9 39 26 (1)

 55 years and older ........................................... 180 98 54.4 5 1 (1)

Age and sex

Total Percent

 Table 11.

Employed in

January 2002 Percent Total

Nonmovers

1Data not shown where base is less than 75,000.

NOTE: Data refer to persons who had 3 or more years of tenure on a job

they had lost or left between January 1999 and December 2000 because

their plant or company closed or moved, there was insufficient work for them

to do, or their positions or shifts were abolished.

Movers

Employed in

January 2002

[Numbers in thousands]

Long-tenured displaced workers by industry of lost job and percent reemployed in the same industry or in the

services industry, January 2002

Total, nonagricultural private wage and salary workers . 1,893 1,413 49.9 33.8

Mining ............................................................................ 27 19 (1

) (1)

Construction .................................................................. 121 82 58.5 17.1

Manufacturing ................................................................ 619 445 46.1 24.9

Durable goods ............................................................. 376 263 40.3 28.1

Nondurable goods ...................................................... 244 182 29.7 20.3

Transportation and public utilities .................................. 131 84 35.7 28.6

Wholesale trade ............................................................. 119 108 21.3 21.3

Retail trade .................................................................... 249 174 48.3 21.3

Finance, insurance, and real estate .............................. 170 138 49.3 16.7

Services ......................................................................... 453 363 66.4 66.4

Industry of lost job Total

Percent in

the services

industry

Total reemployed

Percent in

the same

industry

[Numbers in thousands]

1

Data not shown where base is less than 75,000.

NOTE: Data refer to persons who had 3 or more years of tenure on a job

they had lost or left between January 1999 and December 2000 because

their plant or company closed down or moved, there was insufficient work

for them to do, or their positions or shifts were abolished.

Table 12.
64 Monthly Labor Review June 2004

Displaced Workers

9 percent had taken a service job. Displaced blue-collar workers

were more likely to switch to a service job than their whitecollar counterparts.

Earnings. Of the 2.0 million long-tenured workers displaced

during 1999–2000, 92 percent lost full-time jobs. When

surveyed in January 2002, about 62 percent of them were once

again working in full-time wage and salary jobs, 8 percent

held part-time jobs, and 6 percent were self-employed or

working as unpaid family workers. One-quarter of these

displaced workers were either unemployed or no longer in

the labor force when surveyed. (See table 14.)

Among displaced workers who were reemployed in fulltime jobs in January 2002, half reported earning at or above

what they had earned on the lost job, and half reported earning

less than what they had earned previously. After losing a job

Percent in

service occupations

[Numbers in thousands]

Median weekly earnings of long-tenured displaced full-time wage and salary workers on their lost jobs and on

jobs held at the time of the survey

January:

1984, 1981–82 ..... 2,157 151 1,135 1,023 33.7 17.5 27.0 21.8 $340 $293 –13.8 114 446 309

1986, 1983–84 ..... 1,798 122 1,087 1,086 26.5 13.9 27.1 32.5 329 330 0.3 90 233 266

1988, 1985–86 ..... 1,855 111 1,187 1,105 32.9 14.8 29.3 23.0 412 353 –14.3 143 179 235

1990, 1987–88 ..... 1,464 83 995 878 27.2 18.8 25.1 28.9 416 391 –6.0 92 115 179

1992, 1989–90 ..... 2,011 131 1,201 1,088 31.1 17.1 28.1 23.7 439 410 –6.6 149 275 252

February:

1994, 1991–92 ..... 2,563 201 1,536 1,386 34.4 17.8 28.4 19.4 553 473 –14.5 210 295 322

1996, 1993–94 ..... 2,167 143 1,396 1,245 33.7 19.8 25.2 21.3 539 461 –14.5 184 156 288

1998, 1995–96 ..... 2,011 188 1,358 1,192 26.1 19.3 30.2 24.4 558 535 –4.1 122 104 240

2000, 1997–98 ..... 1,738 109 1,171 1,005 23.7 15.7 34.5 26.1 567 565 –.4 89 101 269

January:

2002, 1999–2000 . 1,853 141 1,140 948 26.4 22.9 30.7 20.0 695 645 –7.2 103 205 264

Survey date

and reference

period for job loss

Part

time

Equal

or

above,

but

within

20

percent

At least

20

percent

below

Displaced

full-time

wage and

salary

workers

Reemployed in full-time wage and salary jobs

Below,

but

within

20

percent

Total 1

Total

who

reported

earnings

Earnings relative

to those of lost job

Median weekly

earnings on:

At least

20

percent

above

Lost

job

Job

held

at

survey

date

 1 Includes some workers who did not report earnings on the lost job.

NOTE: Data refer to persons who had 3 or more years of tenure on a job

Percent

change

Selfemployed

and

unpaid

family

workers

Unemployed

Not in

the

labor

force

they lost or left because their plant or company closed or moved, there was

insufficient work for them to do, or their positions or shifts were abolished.

Table 14.

they had lost or left between January 1999 and December 2000 because

their plant or company closed down or moved, there was insufficient work

for them to do, or their positions or shifts were abolished.

Long-tenured displaced workers by occupation of lost job and percent reemployed in the same occupation or

in service occupations, January 2002

Total, 20 years and older................................................. 2,005 1,487 60.1 9.0

White-collar occupations1 ............................................ 1,194 930 63.7 4.8

Managerial and professional specialty .................... 596 469 68.7 1.9

Executive, administrative, and managerial .......... 373 300 48.3 2.3

Professional specialty .......................................... 223 170 71.2 1.2

Technical, sales, and administrative support .......... 598 461 58.6 7.8

Technicians and related support .......................... 72 53 (2) (2)

Sales occupations ................................................ 249 196 51.0 8.2

Administrative support, including clerical ............ 277 212 50.0 4.7

Service occupations ..................................................... 124 85 64.7 64.7

Blue-collar occupations1 .............................................. 646 454 53.1 7.5

Precision production, craft, and repair .................... 267 219 44.3 8.2

Operators, fabricators, and laborers ....................... 379 235 61.3 6.8

Farming, forestry, and fishing ...................................... 11 6 (2

) (2)

Occupation of lost job Total Total reemployed Percent in the

same occupation

[Numbers in thousands]

Table 13.

1 See text footnote for a definition of the white- and blue-collar occupations.

 2 Data not shown where base is less than 75,000.

NOTE: Data refer to persons who had 3 or more years of tenure on a job
Monthly Labor Review June 2004 65

Total, 20 years and

older ............................ 1,853 141 1,140 948 26.4 22.9 30.7 20.0 $695 $645 –7.2 103 205 264

20 to 24 years ............ 35 4 16 10 (2

) (2) (2) (2) (2) (2) (2) 0 4 12

25 to 54 years ............ 1,478 88 993 842 26.4 21.6 31.1 20.9 697 650 –6.7 80 171 146

25 to 34 years ......... 334 21 229 208 21.2 19.7 28.4 30.8 570 618 8.4 19 28 37

35 to 44 years ......... 590 53 393 342 23.1 24.3 31.9 20.8 708 686 –3.1 24 77 43

45 to 54 years ......... 554 14 370 294 34.0 19.7 32.3 13.9 783 635 –18.9 37 67 65

55 to 64 years ............ 286 37 131 95 29.5 26.3 29.5 14.7 720 662 –8.1 21 23 74

65 years and older ..... 54 12 0 0 0 0 0 0 0 0 0 2 7 33

Men, 20 years and

older ........................... 1,033 42 676 559 25.0 22.9 32.2 19.9 779 721 –7.2 79 125 112

Women, 20 years and

older ........................... 820 99 463 390 28.2 23.1 28.5 20.3 590 527 –10.7 24 80 153

 White3

Total, 20 years and

older ........................... 1,541 115 964 807 26.4 21.8 30.4 21.4 722 670 –7.2 89 159 215

Men ............................ 873 36 590 486 24.9 23.7 30.0 21.4 811 745 –8.1 65 97 85

Women ....................... 669 78 374 321 28.7 19.0 30.8 21.5 605 558 –7.8 24 62 130

 Black3

Total, 20 years and

older ........................... 251 24 143 111 26.1 29.7 36.0 8.1 536 454 –15.3 6 37 40

Men ............................ 124 6 69 58 (2) (2) (2) (2) (2) (2) (2) 6 19 24

Women ....................... 127 18 74 54 (2

) (2) (2) (2) (2) (2) (2) 0 18 16

 Hispanic origin3

Total, 20 years and

older ........................... 143 19 78 71 (2) (2

) (2) (2) (2) (2) (2) 3 28 16

Men ............................ 53 7 29 25 (2) (2

) (2) (2) (2) (2) (2) 3 13 1

Women ....................... 90 12 48 46 (2

) (2) (2) (2) (2) (2) (2) 0 15 15

Educational attainment

Less than a high school

diploma ...................... 167 27 67 53 (2) (2

) (2) (2) (2) (2) (2) 7 27 39

High school graduates,

no college .................. 616 40 351 288 27.8 28.1 24.3 19.8 607 555 –8.6 13 111 100

Some college, no

degree ........................ 419 33 273 240 31.3 21.7 26.3 20.8 615 571 –7.2 18 28 67

Associate’s degree ........ 201 15 143 121 32.2 18.2 33.1 16.5 704 715 –1.6 7 12 24

Bachelor’s degree ......... 311 20 207 177 20.3 22.0 33.9 23.7 998 962 –3.6 39 24 20

Advanced degree .......... 139 5 98 68 (2) (2

) (2) (2) (2) (2) (2) 19 2 14

Characteristic

Part

time

Equal

or

above,

but

within

20

percent

Table 15.

At least

20

percent

below

Displaced

full-time

wage and

salary

workers

Reemployed in full-time wage and salary jobs in January 2002

Below,

but

within

20

percent

Total1

Total

who

reported

earnings

Earnings relative

to those of lost job

Median weekly

earnings on:

At least

20

percent

above

Lost

job

Job

held

in

January

2002

Percent

change

Selfemployed

and

unpaid

family

workers

Unemployed

Not in

the

labor

force

1 Includes 192,000 who did not report earnings on their lost job.

2 Data not shown where base is less than 75,000.

3 Detail for the above race and Hispanic-origin groups will not sum to

totals because data for the “other races” group are not presented and

Hispanics are included in both the white and black population groups.

Median weekly earnings of long-tenured displaced full-time wage and salary workers on their lost jobs

and on jobs held in January 2002, by age, sex, race, Hispanic origin, and educational attainment

NOTE: Data refer to persons who had 3 or more years of tenure on a

job they had lost or left between January 1999 and December 2000 because

their plant or company closed or moved, there was insufficient work for

them to do, or their positions or shifts were abolished.

[Numbers in thousands]
66 Monthly Labor Review June 2004

Displaced Workers

Total, 20 years and

older ............................ 1,853 141 1,140 948 26.4 22.9 30.7 20.0 $695 $645 –7.2 103 205 264

Nonagricultural private

wage and salary

workers ...................... 1,767 130 1,096 917 27.0 23.1 29.7 20.2 694 643 –7.3 100 196 244

Mining ......................... 27 0 15 15 (2

) (2) (2) (2) (2) (2) (2)4 4 4

Construction ............... 116 2 73 65 (2

) (2) (2) (2) (2) (2) (2) 7 34 0

Manufacturing ............ 607 28 379 312 33.3 27.6 20.2 18.9 662 571 –13.7 28 51 121

Durable goods ......... 370 18 213 169 29.0 26.6 22.5 21.9 716 597 –16.6 26 35 78

Nondurable goods ... 237 10 165 143 38.5 28.7 17.5 15.4 614 511 –16.8 2 16 43

Transportation and

public utilities ......... 128 8 68 54 (2

) (2) (2) (2) (2) (2) (2) 5 26 21

Transportation ......... 75 8 40 36 (2

) (2) (2) (2) (2) (2) (2) 5 16 6

Communications and

other public

utilities ................. 52 0 27 18 (2

) (2) (2) (2) (2) (2) (2) 0 10 15

Wholesale and retail

trade ....................... 327 31 196 163 25.2 14.7 44.8 15.3 662 606 –8.5 27 36 37

Wholesale trade ...... 116 12 74 56 (2

) (2) (2) (2) (2) (2) (2) 19 9 3

Retail trade .............. 210 19 123 106 33.0 18.9 34.9 13.2 595 533 –10.4 7 27 34

Finance, insurance,

and real estate ........ 162 18 109 92 19.6 23.9 38.0 18.5 787 716 –9.0 9 12 14

Services ..................... 394 39 257 215 25.6 20.5 29.8 24.2 692 715 3.3 21 30 47

Professional

services ................ 186 18 118 102 33.3 17.6 29.4 19.6 680 688 1.2 10 7 32

Other services ......... 196 20 132 107 19.6 24.3 31.8 24.3 671 711 6.0 10 23 10

Agricultural wage and

salary workers ........... 17 6 2 2 (2

) (2) (2) (2) (2) (2) (2)3 0 6

Government workers ..... 58 4 38 31 (2) (2) (2) (2) (2) (2

) (2) 0 5 11

Industry and class

of worker of

lost job

Part

time

Equal

or

above,

but

within

20

percent

At least

20

percent

below

Displaced

full-time

wage and

salary

workers

Reemployed in full-time wage and salary jobs in January 2002

Below,

but

within

20

percent

Total1

Total

who

reported

earnings

Earnings relative

to those of lost job

Median weekly

earnings on:

At least

20

percent

above

Lost

job

Job

held

in

January

2002

Percent

change

Selfemployed

and

unpaid

family

workers

Unemployed

Not in

the

labor

force

Median weekly earnings of long-tenured displaced full-time wage and salary workers on their lost jobs

and on jobs held in January 2002, by industry and class of worker of lost job

Table 16.

1Includes 192,000 who did not report earnings on their lost job. 2Data not shown where base is less than 75,000.

NOTE: Data refer to persons who had 3 or more years of tenure on a job

they had lost or left between January 1999 and December 2000 because

their plant or company closed or moved, there was insufficient work for

them to do, or their positions or shifts were abolished.

in 1999 or 2000, median weekly earnings for these reemployed persons fell 7 percent.12 One-quarter of this group

reported their earnings on the new job were 20 percent or

more below those on the job they lost.

In an analysis of earnings losses incurred by displaced

workers over the full survey reference period (1999–2001),

Farber not only emphasizes the decline in earnings on the new

job compared with the old, but also measures the foregone

earnings increases many workers might have received had

they not been displaced.13 Using a control group of nondisplaced workers, Farber estimates an average wage gain of

nearly 7 percent in the 1999–2001 period. When combined

with the average earnings decline from the lost job to the new,

Farber finds that the overall earnings decline associated with

displacement increased in the 1990s from a low of 5.5 percent

in the mid-1990s to a high of 15.2 percent in 1999-2001.

Given the relatively strong wage growth since the mid-1990s,

he attributes a greater share of the overall earnings effect to

the foregone earnings component.

Older displaced workers who were reemployed in 2002

experienced steep declines in their median weekly earnings.

Persons aged 45 to 54 saw their earnings decline by 19

percent, and those aged 55 to 64 lost 8 percent at the median.

(See table 15 on page 65.) Younger displaced workers

received better pay in their new jobs, with median weekly

earnings up 8 percent. Men and women had similar median

[Numbers in thousands]
Monthly Labor Review June 2004 67

earnings losses following displacement. Earnings for blacks

declined by 15 percent, about twice the earnings loss

experienced by whites (7 percent).

Reemployed displaced workers across most major

industries experienced earnings losses. Workers displaced

from manufacturing found jobs with median weekly earnings

nearly 14 percent below those on their former job. One-third

had jobs in which earnings were 20 percent or more below

what they earned previously. Those who lost jobs in finance,

insurance, and real estate, as well as those who lost wholesale

or retail trade jobs, saw their median earnings decline by 9

percent upon reemployment. (See table 16 on page 66.)

THE PEAK IN ECONOMIC ACTIVITY in 1999–2000 contributed

to the strongest labor market conditions in 30 years. The

incidence and likelihood of job loss remained low. In

1999–2000, 2.0 million long-tenured workers were

displaced from their jobs, about the same level reported

during 1997–98 (1.9 million). The overall displacement rate

held at 2.5 percent for a second consecutive 2-year survey

period. While these measures indicate there were

relatively few job losers in 1999–2000, the displacement

rate did not fall below the rate experienced during the

economic expansion of the late-1980s.

Of long-tenured workers who lost jobs in 1999 or 2000,

about three-quarters were reemployed when surveyed in

January 2002. Displaced workers who found a new job spent

relatively few weeks without work—5.5 weeks at the median,

about the same as in the prior survey. With little time between

jobs, a relatively small proportion of displaced workers used

unemployment insurance benefits.

The 2001 recession brought an increased incidence of job

displacement. While the official end to the recession preceded

the January 2002 survey date, the labor market in early 2002

was characterized by continued job loss and decreasing labor

demand. These labor market conditions certainly affected

the ability of displaced workers to find new jobs and contributed to overall earnings losses upon reemployment.

Notes

1

 The National Bureau of Economic Research (NBER), generally viewed

as the arbiter of business cycle dates, designated March 1991 as the trough

of the recession that began in July 1990.

2

 Data on nonfarm payroll employment are derived from the Current

Employment Statistics (CES) Survey, a monthly sample survey that collects

information on employment, hours, and earnings from about 400,000

business establishments. The unemployment rate is derived from the

Current Population Survey (CPS), a sample survey of about 60,000

households, conducted monthly by the Census Bureau for the Bureau of

Labor Statistics (BLS). The CPS collects information about the demographic

characteristics and employment status of the civilian noninstitutional

population aged 16 years and older.

3 Displacement rates are calculated by dividing the number of

displaced workers in a specified worker group by a tenure-adjusted, 2-

year average estimate of employment for the same worker group.

Employment estimates for each year were adjusted using job-tenure data

from the January 1983, 1987, 1991, and February 1996, 1998, and 2000

CPS supplements, to include only those workers with 3 years of tenure or

more. A 2-year average was then computed using those adjusted

employment estimates.

4

 Reemployment rates and other measures concerning a worker’s

current employment status may not be strictly comparable between the

2002 and 2000 surveys. In 2002, the survey was conducted in January

and, in 2000, it was done in February. Between January and February of

each year, there is usually a large seasonal increase in employment. Hence,

it is possible that reemployment rates as measured in any given January

may be lower than those measured in February because of this seasonal

employment pattern. However, in the January 2002 data, it is not possible

to disentangle the effects of the seasonal pattern on the data from cyclical

or other economic factors.

5

 Estimates of worker displacement in the year immediately preceding

the survey date should be analyzed with caution. Research suggests a

significant “recall bias” among survey respondents who are asked to report

the year in which they were displaced. There is evidence to suggest that

displacement may be overstated in the year closest to the survey data, in

this case, 2001. For more information on recall bias in the Displaced

Worker Supplement to the CPS, see David S. Evans and Linda S. Leighton,

“Retrospective Bias in the Displaced Worker Surveys,” Journal of Human

Resources, spring 1995, pp. 386–396.

6

 For the purposes of this analysis, blue-collar occupations are defined

as the sum of the “precision production, craft, and repair” and “operators,

fabricators, and laborers” categories. The white-collar occupations are

made up of the “managerial and professional specialty” and “technical,

sales, and administrative support” categories.

7

 See Henry S. Farber, “Job Loss in the United States, 1981–2001,”

Working Paper 9707 (National Bureau of Economic Research, May

2003).

8

 In the survey, the question concerning health insurance on the lost job

specifically relates to receiving coverage from the former employer and

excludes any other sources. The question posed to respondents about

current health insurance coverage (at the time of the survey) relates to health

insurance coverage from any source.

9

 The NBER designated November 2001 as the trough of the recession

that began in March 2001. However, although the recession officially

ended in late-2001, labor market conditions continued to weaken well into

2002.

10 Sewin Chan and Ann Huff Stevens, in their analysis of Health and

Retirement Study (HRS) data, found that a job displacement for an older

worker led to a significant increase in the likelihood of retirement. See

Sewin Chan and Ann Huff Stevens, “How Does Job Loss Affect the Timing

of Retirement?” Working Paper 8780 (National Bureau of Economic

Research, February 2002).

11 For a comprehensive overview of jobs in the services industry,

see Joseph R. Meisenheimer II, “The services industry in the ‘good’ versus

‘bad’ jobs debate,” Monthly Labor Review, February 1998, pp. 22–47.

12 Note that the impact of decreases are somewhat understated, and the

impact of increases overstated, as the earnings data are not adjusted for

inflation.

13 Farber, “Job Loss in the United States,” May 2003.
68 Monthly Labor Review June 2004

Displaced Workers

Appendix: survey methods and data limitations

The data presented in this article were collected through a

supplement to the January 2002 Current Population Survey (CPS), a

monthly survey of about 60,000 households that provides basic data

on employment and unemployment for the nation. The purpose of

this supplement was to obtain information on the number and

characteristics of persons who had been displaced (as defined

below) from their jobs over the prior 3 calendar years.

The first question asked of survey respondents aged 20 and older

was, “During the last 3 calendar years, that is, January 1999 through

December 2001, did (you/name) lose a job, or leave one because:

(his/her/your) plant or company closed or moved, (his/her/your)

position or shift was abolished, insufficient work, or another similar

reason?” If the answer to that question was “yes,” then the

respondent was asked to identify which reason, among the

following, best described the reason for the job loss:

• Plant or company closed down or moved

• Plant or company operating but lost job because of:

Insufficient work

Position or shift abolished

Seasonal job completed

• Self-operated business failed

• Some other reason

Respondents who provided one of the first three reasons—plant

or company closed or moved, insufficient work, or position or shift

abolished—were classified as displaced and asked additional

questions about the lost job, including how many years they had

worked for their employer; the year the job was lost; the earnings,

industry, and occupation of the lost job; and whether health

insurance had been provided. Other questions were asked to

determine what occurred before and after the job loss, such as: Was

the respondent notified of the upcoming dismissal? How long did

he/she go without work? Did he/she receive unemployment

benefits? And, if so, were the benefits used up? Did the person move

to another location after the job loss to take or look for another job?

Information also was collected about current health insurance

coverage (other than medicare and medicaid) and current earnings

for those employed in January 2002. Most data presented here refer

to workers who lost or left jobs in which they had worked for 3 or

more years.

There are several important differences between the February

1994, 1996, 1998, and 2000 surveys, and surveys conducted every

other January from 1984 to 1992, in the counting of displaced

workers that render the data not strictly comparable:

1) In January 1994, there was a major change made to the CPS—

the implementation of a redesigned survey questionnaire and

collection methodology. (For more information on these

changes, see “Revisions in the Current Population Survey

Effective January 1994” in the February 1994 issue of

Employment and Earnings. See also “Overhauling the Current

Population Survey: a special issue,” Monthly Labor Review,

September 1993, pp.3–33.)

2) The reference period used when asking questions about

displacement was shortened from “the prior 5 years” in earlier

surveys to “the prior 3 calendar years” in surveys conducted

since February 1994. This was done because the reliability of

the data appears to decrease as the length of the reference period

increases. For example, in the January 1992 survey, the

number of displacements in the first 2 years—that is, 1987 and

1988—were markedly lower than when those 2 years were the

third and fourth years of the reference period in the January

1990 survey, a clear indication of recall problems in the years

farthest from the survey date.

3) This article also excludes displacements that occurred in the

year closest to the survey date. This was done to reduce the

likelihood of including persons who, having lost their jobs

relatively recently, were counted as displaced when their job

losses eventually prove to be temporary rather than permanent.

4) Displaced workers who cited one of the three displacement

reasons for job loss, and then responded later in the

questionnaire that their “class of worker” on their lost job was

self-employed, were excluded from the count of displaced

workers in the surveys conducted since 1994, whereas they

had been included in prior ones.

5) In the surveys conducted since February 1994, respondents

who reported that they had lost their jobs in the year closest to

the survey date (for example, 2001 in the January 2002 survey),

and expected to be recalled within the next 6 months, were left

out of the count of displaced workers. In earlier surveys,

respondents were not asked directly about their expectation of

recall.

6) Between 1994 and 2000, displaced worker surveys were

conducted in February, whereas the five previous surveys, and

the most recent, were conducted in January. In 1994, the survey

was postponed 1 month to help ease the transition of the

redesigned survey and collection methodology that occurred

in January 1994. Also, the reference periods in the 1994, 1996,

1998, 2000, and 2002 surveys were the prior three calendar

years, for example, 1999, 2000, and 2001 in the January 2002

survey. Prior to the 1994 survey, those losing jobs in the weeks

of January prior to the survey were counted as displaced.

7) Displaced worker surveys conducted prior to the February

1994 survey also are not completely comparable to those from

1994 forward because the earlier surveys were not adjusted for

supplement nonresponse. (It should be noted that supplement

nonresponse was much lower in Displaced Worker Surveys

conducted prior to 1996.) A proportion of the people who

complete the basic CPS questionnaire on labor force status do

not provide usable responses to the supplementary questions.

Respondents may choose to answer none of the supplement

questions, or they may not provide answers to key questions

within the supplement. Reweighting is one of the methods

historically used to adjust for such supplement nonresponse.

It accounts for missing information by increasing the weights

assigned to the individuals from whom information was

obtained. Currently, the Census Bureau calculates supplement

weights for all CPS supplemental questionnaires.

During and after the administration of the February 1996 and

1998 Displaced Worker Surveys, quality assessment research was

conducted as part of the Bureau’s ongoing effort to improve the

quality of its surveys. For more information on the research

conducted on the February 1996 survey, see James L. Esposito and

Sylvia Fisher, “A Summary of Quality-Assessment Research Conducted on the 1996 Displaced-Worker/Job-Tenure/OccupationalMobility Supplement,” BLS Statistical Note Number 43.