Young people could experience layoffs, according to recent data that has measured the metrics and examined some analytics. Recent years have seen people between the ages of 25 and 34 flourish in the job market, but the same candidates who quit their jobs en masse a few short years ago are now at risk of being laid off from their new positions. Indeed, many young professionals may find themselves on the chopping block as their employers look for ways to cut costs and eliminate excess labor.
Young People Could Experience Layoffs: The Cause and Effect
Any employer planning to lay off employees should invest in staffing professional liability insurance and errors and omissions coverage. Insurers who offer staffing services coverage should understand the following four reasons layoffs are rising.
Insufficient Tenure
Layoffs happen every day. In fact, according to statistics, there can be as many as 17 million layoffs in a single year. Young people may face the first round of layoffs, since they are usually the newest employees at a company. In most cases, the employees with the shortest length of tenure will be the first to get let go. Luckily, those who can retain their employment will see it become more secure as they gain tenure.
Economic Uncertainty
Many companies are also laying off employees because of increasing economic uncertainty — which affects employees of all ages. Inflation, for example, has caused the cost of goods and services to go up considerably. Some sources say inflation has a bigger impact on millennials than on other age groups. Young professions could experience layoffs due to inflation costs.
Hiring Overcorrection
When millions of employees resigned in 2020 and 2021, many employers panicked as they faced unprecedented understaffing problems. These employers struggled to hire replacements for employees that resigned, too. When the tides began to turn, many companies over-corrected and hired too many employees to compensate for the prior shortage. Once it became clear that the national labor shortage was coming to an end, these businesses faced the reality of overstaffing rather than understaffing. Many are now laying off employees as a result.
Return to the Office
Many companies are also returning to the office or might do so shortly. As the shift from remote work back to in-person work unfolds, some companies are reassessing their labor needs and finding that they can cut costs by letting go of some team members. The transition to in-person work offers the perfect opportunity to do so — especially for companies that enjoy the protection of staffing professional liability insurance. Young professionals who find themselves laid off from a remote position could find other web-based work opportunities that utilize their skills.
About World Wide Specialty Programs
For the last 50 years, World Wide Specialty Programs has dedicated itself to providing the optimal products and solutions for the staffing industry. As the only insurance firm to be an ASA commercial liability partner, we are committed to that partnership and committed to using our knowledge of the industry to provide staffing firms with the best possible coverage. For more information about Staffing Professional Liability Insurance or any other coverage, we have available to protect your staffing business, give us a call at (877) 256-0468 to speak with one of our representatives.