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‘Furlough’: Time Off, Once Temporary, But Now Often Unclear (#GotBitcoin?)

What started four centuries ago as a voluntary break from work duties has become involuntary—and sometimes permanent. ‘Furlough’: Time Off, Once Temporary, But Now Often Unclear (#GotBitcoin?)

‘Furlough’: Time Off, Once Temporary, But Now Often Unclear (#GotBitcoin?)

Company after company in recent weeks has announced having to furlough many employees, whether retailers like Macy’s and Under Armour, entertainment giants like Disney and AMC, or major car manufacturers like Honda and Tesla.

As businesses struggle to stay afloat during the coronavirus pandemic, the word “furlough”—used as both a noun and verb for the temporary suspension of work, typically without pay—has become all too common, though its exact meaning can sometimes be hard to pin down. Do “furloughs” differ from “layoffs?” And does the ostensibly temporary nature of furloughs potentially mask more permanent job losses?

Confusion over the term is even more pronounced in the U.K., where British officials have described a government initiative that temporarily reimburses lost wages as a furlough program. The BBC reports that “until recently, many people in the U.K. had never heard of ‘furlough.’” Despite its use in English for nearly four centuries, the word’s current meaning of a temporary layoff is largely an Americanism. (Unlike the British policy, furloughs in the U.S. don’t usually involve reimbursing workers for wages, though employee benefits may be preserved.)

“Furlough” goes back to a Dutch word meaning “permission”: “verlof,” which combines Germanic roots meaning “for” and “leave.” The term originally referred to a leave of absence given to a soldier. It was one of many words borrowed from Dutch—including “beleaguer” and “knapsack”—at a time when England and Holland were often entangled militarily, either as allies or rivals.

The first known appearance of the term in English came in 1631 in the writings of Ben Jonson, who spelled it as “vorloffe.” Early on, the word had many variant spellings, but they all suggest it was first pronounced to rhyme with “off.” A 1637 report of an expedition led by a Scottish general spelled it two different ways, telling of “sundry officers having taken forloffes,” as well as a lieutenant colonel “taking a fore-loofe” to go to Holland.

By the late 18th century, the spelling settled into “furlough,” with the second syllable pronounced as “low.” The word also had been extended to other kinds of permitted leave-taking and came into use as a verb as well. Just as in the military, a furlough was seen as a perk rather than a punishment.

That started to change in American usage in the years leading up to the Civil War. A bill before Congress in 1853 to reorganize the Navy detailed how officers could be removed from active service by being “furloughed” or even “permanently furloughed,” implying it was no longer considered strictly voluntary or temporary.

Other spheres of employment joined the shift. An 1867 article in the Daily Whig and Courier of Bangor, Me., related that “there were furloughed twenty-three printers” in the Government Printing Office, all discharged from service. In 1876, the Daily Globe of Rutland, Vt., reported on “a general suspension of operations” by coal-mining firms: “12,000 workingmen will be furloughed for an indefinite time.”

In 1940, the Washington Post wrote that in the Public Works Administration, nearly 400 employees were being “severed from the payrolls.” “Even though they are masked under the euphonious name of ‘furloughs,’ the dismissals are actual enough,” the Post reported.

That murkiness continues to hang over the word. Deborah Brouwer, a partner with Detroit-based Nemeth Law, which specializes in labor and employment, has fielded questions from clients seeking to understand the difference between “furloughs” and “layoffs.” Though the terms may be used interchangeably in practice, Ms. Brouwer explains that “a furloughed worker, at least in the current pandemic environment, is expected to be called back when the health crisis has abated.” It’s an open question, however, just how accurate that definition will prove to be.

Updated: 5-10-2020

Factories Close For Good As Coronavirus Cuts Demand

Some manufacturers that furloughed employees during lockdowns say plants won’t reopen.

Factory furloughs across the U.S. are becoming permanent closings, a sign of the heavy damage the coronavirus pandemic and shutdowns are exerting on the industrial economy.

Makers of dishware in North Carolina, furniture foam in Oregon and cutting boards in Michigan are among the companies closing factories in recent weeks. Caterpillar Inc. said it is considering closing plants in Germany, boat-and-motorcycle-maker Polaris Inc. plans to close a plant in Syracuse, Ind., and tire maker Goodyear Tire & Rubber Co. plans to close a plant in Gadsden, Ala.

Those factory shutdowns will further erode an industrial workforce that has been shrinking as a share of the overall U.S. economy for decades. While manufacturing output last year surpassed a previous peak from 2007, factory employment never returned to levels reached before the financial crisis.

Michigan Maple Block Co. furloughed most of its 56 workers at its plant in Petoskey, Mich., when the state implemented a stay-at-home order on March 24. A month later, the manufacturer of cutting boards and industrial table tops told employees the plant would close for good.

A second factory in Pennsylvania will remain open because of cheaper energy costs, said Ann Dau Conway, president of the company that her family has owned for generations.

“The hardest decision of my life. Not just my professional life,” Ms. Conway said.

The closures suggest that a growing share of the record job losses in recent weeks won’t be temporary, said Gabriel Ehrlich, an economic forecaster at the University of Michigan. The more that job losses turn from temporary to permanent, he said, the harder the hit to consumer spending and every company that relies on it—including manufacturers.

“The higher the proportion of permanent layoffs, the worse the chances of a strong recovery start to look,” Mr. Ehrlich said.

Layoffs have already wiped away nearly a decade of employment gains at U.S. manufacturers. Factories added 1.4 million workers from 2010 through the end of last year, employing a total of 12.9 million people in December. The manufacturing workforce has since dropped to 11.5 million, the Bureau of Labor Statistics said Friday, including 1.3 million jobs lost in April alone, though this also includes temporary layoffs.

Manufacturers in recent years have pushed up output faster than they have expanded payrolls, in part by investing in automation. Since the pandemic took hold, capital investment by manufacturers has cratered.

Robert Atkinson, president of the Information Technology and Innovation Foundation, a Washington, D.C., technology-research think tank, said companies that hadn’t invested in more efficient plants will struggle to keep operating them profitably while demand is much lower.

“Manufacturing is becoming a stagnant sector,” he said.

Layoff notices from states across the country indicate a rise in permanent factory closures in recent weeks. In one, Blue Bell Mattress Co. said it was closing its plant in Roseville, Mich., after losing its only two customers within several weeks. First, furniture chain Art Van Furniture LLC filed for bankruptcy in early March. Weeks later, Connecticut-based chain Bob’s Discount Furniture canceled orders and closed its warehouses to new deliveries because it had closed its stores during the crisis.

Chicago-based R.R. Donnelley & Sons Co. told analysts last month that demand for its printed signs and mailers fell as companies cut back on marketing over the past two months. The company is closing two printing plants in St. Louis and laying off 72 workers.

Lenox Corp., a maker of china dishes including sets for the White House, is closing its last factory, in Kinston, N.C., and laying off 159 employees, who produced as many as 20,000 pieces of fine china each day.

Chief Executive Mads Ryder said stay-at-home restrictions had decimated orders from stores that stock Lenox plates and cups.

“What happened in the retail environment simply just overwhelmed us,” he said. Lenox will now make all of its products through contract manufacturers abroad. Those manufacturers make plates for multiple designers, creating economies of scale that his plants in the U.S. couldn’t match, he said.

“This is a natural step in a global world,” he said. “You can’t tell the difference.”

John La Tocha, a machine operator at Michigan Maple Block for more than 20 years, said the company had struggled to recapture business lost after the housing market collapsed in the 2008 recession, and only recently reversed some pay cuts implemented at that time.

Now, the dimming construction outlook and restaurant closures will sap orders for the company’s cutting boards and counters.

Mr. La Tocha said he doesn’t expect to find another woodworking job in northern Michigan, where the economy has shifted toward tourism from manufacturing over the years.

Michigan officials are allowing factories to open again on Monday. Michigan Maple Block won’t be among them.

“When I started to work there, it was one of the best jobs in the area,” he said. “If it opened back up, I’d go back to work right away.”

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