Even while forced to layoff part of their workforce thereby reducing capacity, employers continue to foot the bill for rising unemployment costs.  They not only fund benefits for their own displaced workers, but also for workers of companies that have gone out of business.  On top of all of that, employment litigation rises during times of increased unemployment increasing the burden further on the employer. 

Employers need to properly prepare for a layoff situation paying particular attention to the selection criteria for individuals involved (see also TALX Blog "Preparing for a Layoff".) 

Tammy Mullin