State data gives early warning of layoffs from larger companies, but lost jobs from small businesses go uncounted

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A few months ago, Everyday Kitchen on Neil Street in Champaign suddenly announced its closing after over four years in business.

But if one knew about the state’s layoff notification program, they could have seen that, the next day, owners Clever Moose Inc. had alerted the state to the layoffs of 31 employees because of “poor economy” on Dec. 8, 2022. 

Screenshot of Illinois’s layoff reporting database on the Illinois Worknet website.

A state law requires companies to notify the state when they plan to lay off workers. This law is known as the WARN Act, which stands for Illinois Worker Adjustment and Retraining Notification Act, and is slightly different than the federal WARN act.

Indeed, three years ago, the News-Gazette alerted the state to 130 layoffs before it declared bankruptcy and sold itself to the family-owned Champaign Multimedia Group LLC, an affiliate company of Community Media Group.

In January, the system listed notices of the expected layoffs of 451 employees from State Farm in Bloomington.

Not all layoffs are included in the WARN system. It only applies to companies with 75 or more full-time employees, or if they fall under certain criteria. According to the WARN guide, companies should provide 60 days advance notice of pending shutdowns or mass layoffs.

Just this week it was announced that all five University of Illinois campus locations for Einstein Bros. Bagels and Nic’s Cafe, owned by BOAST, LLC., would be closing. However, these do not appear in the WARN system as of publication.

A review of the last five years, of layoff notices, from March 20, 2018 to March 20, 2023, by shows:

  • A total of 1,049 notices of the layoffs of 141,890 employees in Illinois.
  • A total of 8 notices of the layoffs of 662 employees in Champaign.
  • A total of 4 notices of the layoffs of 833 employees in Urbana.
  • In Champaign County, there were a total of 12 notices of layoffs of 1,048 employees. 
  • In the 6 counties contiguous to Champaign County, there were 17 notices of layoffs of 1,533 employees. 

Champaign Senior Planner for Economic Development TJ Blakeman said there is no way to track layoffs from small businesses, however. 

“The City of Champaign does not require a business license, and therefore we can’t collect employment data on that granular level every year,” Blakeman said in an email. “The Economic Development Corporation works to assemble our largest employers list, but that is a separate process of calling and working with those businesses to self-report their total employment numbers.”

Likewise, Urbana also does not require a general business license.

Among the 12 Champaign County companies with recorded layoffs are: News Gazette Media, Bear Down Logistics, Bergner’s, Clever Moose Champaign, Hobbico, Inc., Menasha Packaging Company, LLC, Toys R Us, and Rockwell Automation, Inc. in Champaign; Flex-N-Gate, Solo Cup Operating Corporation, and Hampton Inn on University in Urbana; and Worden Martin Buick GMC and Subaru in Savoy.

As of February this year, the unemployment rate in Illinois is 4.5%, slightly higher than the 3.9% nationwide according to the Illinois Department of Employment Security. In Champaign County, unemployment is at 4.1%.

The pandemic fueled layoff causes and reasons

Of the four full years in the past 60 months, 2020 saw the highest number of jobs laid off in Illinois.

The highest number of layoffs was in the year 2020 during the pandemic. During this time there were a total of 5 layoff notices for 895 employees in Champaign and Urbana.

During the pandemic, Flex n Gate, which has plants in Urbana and is run by local billionaire Shahid Khan, notified the state of 400 layoffs at its facility on Guardian Drive and 150 layoffs on University Avenue. Also in Urbana, Hampton Inn had 25 layoffs and Solo Cup Operating Corporation had 258 layoffs.

Other Champaign businesses that laid off employees during the pandemic include Bear Down Logistics with 62 layoffs, Worden Martin Buick GMC and Subaru with 83 layoffs and Menasha Packaging Company, LLC with 22 layoffs.

Blakeman said he wasn’t sure how often workers would consult the records themselves, and there is no available data on the usage of the WARN system by workers.

“I would hope that before a company reports such drastic reductions in the workforce, they communicate with their employees first. However, that would be up to the employer,” he said.

“National Disaster” was used to indicate pandemic-related causes of layoffs in the WARN database.

Overall, national disasters were listed as the most common cause of a mass layoff in the last five years. It was listed 377 times in several forms as the cause of layoff in Illinois, about 36% of all notices. This is due to COVID-19, which is classified as a national disaster, and was the cause for 46% of the total number of jobs laid off in the last five years. 

Only three reasons were listed in the data for the notices: plant closure, layoffs and mass layoffs. Out of all the layoffs in Illinois in the last five years, plant closure was listed the most at 673 times, which makes up 64% of all reasons given in notices. Layoffs were the reason in 274 notices, or 26%, and mass layoffs were the reason in 102 notices, or 9.7%, but notices with mass layoffs as the reason impacted more jobs than notices with just layoffs.

Plant closures impacted 110,165 jobs, making up 77.6% of jobs laid off in the state. Mass layoffs impacted 21,095 jobs, or 14.9%, and layoffs impacted 10,630 jobs, or 7.5%. 

Overall, accommodation and food services are the industry with the most layoffs at 36,815 jobs, making up around 26% of statewide layoffs over the past five years. Other sectors with high layoff numbers are manufacturing at 30,021, transportation and warehousing at 21,111 and retail trade at 12,530.

Industries with low layoff numbers include: management of companies and enterprises, construction, utilities, public administration, mining, and agriculture, forestry, fishing & hunting. Each industry listed has laid off less than 1,000 jobs in the past five years.

Among the 1,049 layoff notices in the past five years, unions were involved in 209 of them. Most of the cases happened in hotels, restaurants and manufacturing.

Only one union was involved in the recorded layoffs in Champaign. The Printing, Publishing and Media Workers Sector of the Communication Workers of America, Champaign-Urbana, was involved in News-Gazette Media’s 2019 layoffs.

Although Champaign doesn’t typically consult this data for economic planning purposes, “It is a good historical database that can be useful when a city is examining trends over a period of time,” Blakeman said.

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