WARN Act Layoffs in Pueblo, Colorado

Analysis: Layoffs in Pueblo, Colorado

# Pueblo's Layoff Crisis: A Deep Dive into Colorado's Emerging Jobs Challenge

Overview: The Scale and Urgency of Workforce Disruption

Pueblo, Colorado faces an unprecedented employment crisis. Between 2017 and 2026, the city has experienced 11 WARN Act notices affecting 880 workers—a figure that understates the true economic damage when accounting for indirect job losses in supporting sectors. What makes this data particularly alarming is the temporal clustering: 2025 alone accounts for 4 notices (36 percent of the total), with momentum carrying into 2026. This acceleration signals not random corporate restructuring but systemic pressures reshaping Pueblo's employment foundation.

The concentration of impact is severe. A single employer—Express Scripts—accounts for 338 of the 880 affected workers, representing 38 percent of all layoffs tracked. Add St. Mary Corwin Medical Center with 272 workers, and two employers alone account for nearly 69 percent of the displacement. This concentration creates vulnerability; Pueblo lacks the diversified employer base that typically cushions communities against localized economic shocks.

The 880 workers represent roughly 1.2 to 1.5 percent of Pueblo County's total employment, depending on the year. While this percentage appears modest in isolation, the actual impact is concentrated among specific demographics and neighborhoods. Workers displaced from healthcare and pharmaceutical sectors typically earn $40,000 to $65,000 annually—middle-class wages that support mortgage payments, childcare, and discretionary spending. Their sudden joblessness cascades through local retail, restaurants, and service sectors that depend on stable consumer demand.

Dominant Employers and the Pharmaceutical-Defense Complex

The layoff landscape reveals two distinct employer clusters, each operating under different economic pressures. Amentum, a defense contractor, leads in frequency with four WARN notices over the study period, though these notices affect only 95 workers total. The fragmentation across multiple small notices—rather than one massive layoff—suggests ongoing operational adjustments rather than facility closure. Defense contracting remains volatile, subject to Congressional appropriations cycles and shifting Pentagon priorities.

Express Scripts, conversely, represents pharmaceutical and pharmacy benefit management sector contraction. The 338-worker layoff is the single largest displacement event in Pueblo's recent history. As a pharmacy benefit manager, Express Scripts operates in an industry experiencing fundamental transformation. Consolidation within pharmaceutical distribution, coupled with margin compression from increased healthcare cost scrutiny, has forced major restructuring across the sector. Pueblo likely housed a significant processing or customer service operation vulnerable to automation and outsourcing.

St. Mary Corwin Medical Center, the city's second-largest healthcare employer, filed a notice affecting 272 workers. Healthcare systems nationwide are grappling with post-pandemic financial stress, labor cost escalation, and shifting reimbursement models. Rural and mid-sized hospitals face particular pressure as Medicare and Medicaid reimbursement rates remain constrained while operational costs rise. The St. Mary Corwin layoff likely reflects departmental consolidation, service line reduction, or administrative restructuring rather than facility closure—a critical distinction meaning remaining operations continue but at reduced capacity.

Battelle, a research and development organization, filed three notices totaling only 13 workers, suggesting minor realignment rather than meaningful contraction. Russ Davis Wholesale and FedEx represent logistics and distribution disruption, sectors simultaneously experiencing automation adoption and consumer demand volatility. The 53 FedEx workers represent adjustment to package volume fluctuations and route optimization, while the 109 Russ Davis Wholesale workers suggest consolidation within broader supply chain restructuring.

Industry Patterns and Structural Forces

The explicit industry breakdown captures only healthcare (272 workers) and wholesale trade (109 workers), leaving 499 workers classified outside these categories. This gap likely reflects pharmaceutical manufacturing and processing, defense contracting, and business services—industries present in the employer data but absent from the industry classification. This reporting inconsistency illustrates broader challenges in tracking layoff causes.

What becomes evident is that Pueblo's employment base faces disruption across multiple fronts simultaneously. Healthcare, typically a stable employment sector in smaller metros, is contracting. Pharmaceutical distribution—which likely represented a significant opportunity when facilities were established—faces structural decline. Defense contracting remains present but fragmented. Wholesale trade shows pressure from logistics automation and consolidation.

The common thread is digitalization and consolidation. Companies across these sectors are deploying technology to reduce labor requirements while consolidating operations into fewer, larger facilities. Express Scripts likely consolidated Pueblo operations into larger regional centers. Healthcare systems are centralizing back-office functions. Distribution logistics are increasingly automated. These are not temporary adjustments but permanent structural shifts that will not reverse through business cycle recovery alone.

Historical Trajectory: Acceleration Into Crisis

The temporal distribution reveals a troubling acceleration. The period from 2017 through 2022 averaged 0.67 notices annually. Beginning in 2023, this rate nearly tripled, with 2025 reaching four notices in a single year. This is not statistical noise; it represents genuine acceleration in workforce displacement.

The lag between notice filing and actual separation typically ranges from 30 to 180 days, meaning 2025 notices primarily translate into job losses occurring in late 2025 and early 2026. Workers currently employed in Pueblo are facing the highest probability of displacement they've encountered in the decade captured by WARN data. The single 2026 notice provides minimal reassurance; historically, WARN filings often lag actual corporate decision-making, and additional notices may emerge before year-end.

This acceleration trajectory distinguishes Pueblo from gradual decline. The community isn't bleeding jobs steadily; it's experiencing acute ruptures in specific major employers. This creates policy urgency that steady-state unemployment does not.

Local Economic Consequences and Labor Market Disruption

Pueblo's unemployment rate benefits from being calculated across the broader county, which includes less-affected areas. But citywide impacts are acute. The displacement of 880 workers over nine years represents continuous labor market pressure. Unlike a single catastrophic facility closure, which mobilizes state and federal assistance programs, this distributed disruption often escapes focused policy attention.

The affected workers face significant re-employment challenges. Middle-skilled healthcare and pharmaceutical workers possess credentials with limited transferability. A pharmacy technician or healthcare administrative specialist cannot easily transition into manufacturing or skilled trades without retraining. Pueblo's local economy offers limited comparable employment in growing sectors. The nearest major metro—Denver—lies 100 miles away, creating an impractical commute for most workers.

Wage replacement is problematic. While some displaced workers find alternative employment within 6-12 months, many accept positions paying 15-25 percent less than original wages. This creates lasting household income reduction extending far beyond the initial displacement. Consumer spending contracts, affecting local retail and services. Property tax revenue faces pressure as household incomes decline and real estate values stagnate.

The multiplier effect compounds through the local economy. Reduced consumer spending means restaurant, retail, and personal service sectors experience corresponding pressure. These secondary impacts typically generate 0.3 to 0.5 additional job losses per primary job lost, suggesting the 880 WARN-tracked workers may ultimately translate into 1,100-1,400 total jobs lost when secondary effects fully manifest.

Regional Positioning and Colorado Comparative Context

Colorado statewide experienced robust employment growth through the 2010s and early 2020s, driven by technology sector expansion in Denver and Front Range metro areas, energy sector volatility, and outdoor economy growth in mountain communities. Pueblo, positioned south of this growth corridor, captured limited spillover benefits. The city's economy remains dependent on legacy industries—healthcare, distribution, manufacturing—precisely the sectors experiencing structural decline nationally.

Pueblo's vulnerability differs from Colorado's prosperous metros but parallels other post-industrial regions nationally. The community lacks the high-wage tech and professional services employment that sustains Denver. It cannot compete with mountain communities for tourism-driven economies. Its manufacturing base, while present, operates at smaller scale than traditional Midwest manufacturing hubs. Pueblo occupies an economically precarious position: too distant from metro opportunity, too small for economies of scale, too dependent on sectors facing structural headwinds.

The 2025-2026 acceleration likely reflects broader Colorado economic softening beyond Pueblo. Regional demand pressures in healthcare and distribution could explain why major employers are simultaneously adjusting. If Express Scripts consolidated operations as part of broader pharmaceutical industry restructuring, or if St. Mary Corwin adjusted staffing responding to state Medicaid reimbursement changes, Pueblo experiences consequences driven by forces beyond local control.

The city requires immediate, multi-sector workforce strategy focused on resilience rather than recovery. Workforce retraining programs, support for entrepreneurship, attraction of new employers, and infrastructure investment in growth sectors represent necessary responses. Without proactive intervention, Pueblo risks settling into a cycle of persistent displacement and wage stagnation affecting workers and eroding the tax base supporting critical community services.