NerdWallet: The industries where jobs are most at risk of layoffs in 2023
This article is reprinted by permission from NerdWallet.
Tech and media layoffs have gotten the most headlines lately. But combined, the two high-profile industries account for only about 5% of U.S. employment, according to the U.S. Census Bureau.
Other industries are also cutting jobs, including the auto industry, manufacturing and financial services. Unemployment is expected to deepen as the Fed slows the economy in a continuing effort to tame inflation.
What jobs are most at risk and which are the most secure? And what if you still have a job or are looking for one as the economy transitions?
2023 jobs most at risk
Outsource Accelerator, an offshore workforce marketplace, analyzed data from the U.S. Bureau of Labor Statistics to determine industries with the highest layoff rates in 2022 to calculate potential layoffs in 2023.
It will probably come as no surprise, but the arts, entertainment and recreation industry topped the list with the lowest job security and the highest layoff rate last year: 2.98%. If that layoff trend continues this year, it would equal an average of 69,400 jobs cut — per month.
Construction jobs were the next most at risk, with an average layoff rate of 1.8%, equal to 139,200 workers losing jobs each month.
Plus: More than 55,000 global tech-sector employees have lost jobs in 2023: layoff-data tracker
Even one of the broadest employment areas, professional and business services, had a 1.56% layoff rate. It represents a massive swath of in-office careers with 22.6 million employees, including accounting, advertising, computer services, engineering and more. A similar layoff trend in 2023 would represent a monthly average of 353,000 people losing their jobs.
Of course, there’s the time-worn investment disclaimer that “past performance does not guarantee future results,” and that applies here. Just because an industry had a certain layoff rate in one year doesn’t necessarily imply that it will continue at the same clip the following year. But while U.S. unemployment remains incredibly low, layoffs are gaining momentum as employers — large and small — prepare for the economy to downshift.
Read: ‘It is an employer’s market’: Tech layoffs may have turned the Great Resignation into the Great Recommitment
Most secure jobs
The same analysis identified the industries offering the most job security. They were:
The federal government, with a layoff rate of 0.22%. Still, that would project an average of 7,000 employees being laid off each month.
State and local education (0.3%; 33,600 layoffs per month).
Finance and insurance industry (0.4%; 35,100 layoffs per month).
One more blow to the financially vulnerable
First, higher prices strained already meager savings. That’s the scourge of inflation. Now, as economists scheme ways to cool the business climate, low- to middle-income workers may worry about fewer paid hours or losing their income altogether.
And this follows the pandemic financial pounding that slammed those who were most financially vulnerable.
In 2021, a study by the Brookings Institution found that low-wage workers made up 43% of the pre-pandemic workforce. A year into the COVID-19 economy, those same low-wage workers represented more than half (52%) of people considered “displaced” — in other words, their jobs had yet to recover at the same pace as higher-wage jobs.
“Losing a job can be devastating for anyone, regardless of income level. But it can be especially turbulent for those already living paycheck to paycheck or without alternative sources of income,” the study said.
Here’s what you can do to give yourself greater immunity from job cuts.
Protect and advance your career
No one is layoffproof. But enhancing your value — to yourself, your employer and your future employer — can help reduce your long-term career risk.
Here are a few ideas.
Separate yourself from the pack
It’s easy to get down in tough times. Negativity reigns. You may find watercooler talk (or Zoom chats) quickly devolving into all of what’s wrong at work or in the world. Nudge yourself into positive territory.
While remaining compassionate, ease the room into conquer mode. Highlight individual successes, even if they’re minor. Talk about businesses that survived and thrived in tough times. Inspire.
Expand your responsibilities
When a business is looking to downsize, it often seeks to trim underperformers or borderline employees. Do more. Take on tasks that need to be done, but that might not be squarely in your swim lane. Volunteer for new projects or take assignments when everyone else is standing down.
See: What to do if you get laid off: Take a deep breath, and make these 6 financial moves
Consider training as a side gig
A lot of people take on side gigs when money is tight. They get joy from cranking up the music in their car while Door Dashing, or wearing PJs and Wicked Good Moccasins while making money online.
Make the goal for one of your side gigs to be getting more training in a field with a quality career future. Maybe it’s a certification related to your current line of work. Or maybe a Google Certificate that takes three to six months to complete and connects you to in-demand jobs. You might take a series of college courses to hone skills such as marketing, finance, technology, graphic design, writing, public speaking or a second language.
Enhance your job market value.
In all cases, save money like never before
Jamie Dimon, the CEO of JPMorgan Chase
is one of the few financial industry leaders to still be in a major bank’s big chair since well before the 2008 financial crisis. He has often spoken about how the bank has built a “cash moat” to protect it during tough times.
“Our bank operates in a complex and sometimes volatile world,” he said in a letter to investors in 2017. “We must maintain a fortress balance sheet if we want to continually invest and support our clients through thick and thin.”
See: Paying off debt, or trying to save more and spend less? Consider these tactics.
You might want to build your own fortress of savings. Start with commonsense ways to slim down your spending. Money in the bank gives you room to breathe in bad times and good. And, if worse comes to worst, know what to do with your money after a layoff.
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