In the current economic downturn, Richmond has largely avoided a rash of big, morale-busting layoffs — but a new trend appears to be emerging: The quiet layoff.
Take, for example, Richmond-based Carpenter Co. The company isn't talking, but a source who requested anonymity says she was laid off by the company on July 18 as part of a round of company-wide job cuts. She says the layoffs were described to her as necessary because the company is losing money. In 2007, the foam and bedding manufacturer posted sales of $1.65 billion.
The former Carpenter employee says she was one of just five local workers let go. She isn't alone. S&K Famous Brands, based in Richmond, cut 50 corporate office jobs in late July in response to dwindling sales. The company posted a $3.93 million loss in the most recent fiscal year, which ended in early February.
Circuit City also announced plans to cut more than a 100 jobs in Richmond over the past six months. But those cuts are among the biggest announced layoffs locally. The unemployment landscape has mostly been afflicted by lots of little cuts and tweaks, a few here, a half-dozen there.
Though a half-dozen people seems like small change in terms of adding to the area unemployment rolls, William F. Mezger, chief economist with the Virginia Employment Commission, says layoffs of this size by numerous employers are not insignificant when taken together.
"You seem to be getting a lot of small layoffs," Mezger says. "You're seeing more than was the case a year ago. I think its basically because of less business and trying to be more profitable."
Richmond's unemployment rate has increased — 4.5 percent this June compared to 3.2 percent this time last year — and manufacturing has been hit particularly hard.
"Manufacturing, for whatever reason, just seems to continue to dwindle in size," Mezger says, noting Richmond's current 41,000 manufacturing jobs shrank by 1,700 — 4 percent — in the last year.
Economists have yet to declare the country in a recession — the government rebate checks helped spark a small uptick this spring — but most are bracing for what could be a rough third and fourth quarters.