Working Paper
Advance Layoff Notices and Labor Market Forecasting
Abstract: We collect rich establishment-level data about advance layoff notices filed under the Worker Adjustment and Retraining Notification (WARN) Act since January 1990. We present in-sample evidence that the number of workers affected by WARN notices leads state-level initial unemployment insurance claims, changes in the unemployment rate, and changes in private employment. The effects are strongest at the one and two-month horizons. After aggregating state-level information to a national-level “WARN factor” using a dynamic factor model, we find that the factor substantially improves out-of-sample forecasts of changes of manufacturing employment in real time.
Keywords: initial UI claims.; mass layoffs; employment; unemployment; plant closings; WARN act;
JEL Classification: E27; J65; K31;
https://doi.org/10.26509/frbc-wp-202003
Access Documents
File(s):
https://doi.org/10.26509/frbc-wp-202003
Description: Full Text
Bibliographic Information
Provider: Federal Reserve Bank of Cleveland
Part of Series: Working Papers
Publication Date: 2020-01-31
Number: 20-03
Related Works
- Working Paper Revision: Advance Layoff Notices and Aggregate Job Loss