WARN Act Layoffs in Lafayette, Indiana

Analysis: Layoffs in Lafayette, Indiana

# Economic Analysis of Layoffs in Lafayette, Indiana

Overview: Scale and Significance of Lafayette's Layoff Burden

Lafayette has experienced substantial workforce disruption over the past two decades, with 22 WARN notices collectively affecting 3,938 workers. This aggregate figure masks significant concentration—just three companies account for 2,681 displaced workers, representing 68 percent of all layoffs tracked. The median WARN notice in Lafayette involves 83 workers, yet the distribution is heavily skewed toward manufacturing and logistics sectors where single closures or restructurings can eliminate hundreds of jobs simultaneously.

To contextualize Lafayette's experience, the city's total WARN-affected workforce represents a notable percentage of the area's employment base. While Lafayette proper has a population around 70,000 and the greater metropolitan area extends considerably larger, displacement of nearly 4,000 workers over two decades signals recurring economic stress in sectors that historically anchored the region's middle-class employment landscape.

Caterpillar's Dominance: Manufacturing's Fragile Foundation

Caterpillar emerges as the overwhelming driver of Lafayette's layoff history, with three separate WARN notices displacing 1,565 workers—accounting for 40 percent of all tracked job losses. This concentration reflects both the company's historical significance as a regional employer and the cyclical vulnerability of heavy equipment manufacturing to global economic downturns.

The company filed notices through multiple subsidiaries, including Caterpillar Logistics Services, Inc, which separately laid off 158 workers. These layoffs did not cluster in a single year but occurred across different economic cycles, suggesting that Caterpillar's Lafayette operations have faced recurring restructuring pressure rather than a single catastrophic closure. The fragmentation across notices and subsidiary entities indicates the company's approach to workforce reductions—spreading them across business units and time periods rather than announcing a dramatic single facility shutdown.

Caterpillar's presence underscores a critical vulnerability in Lafayette's economic structure: overdependence on a single large multinational employer with manufacturing operations subject to global commodity price cycles, international competition, and capital investment decisions made thousands of miles from Indiana.

Wabash National and Diversified Manufacturing Challenges

The second-largest single layoff event involved Wabash National, which filed one notice affecting 790 workers—representing 20 percent of Lafayette's total WARN-tracked displacement. Wabash National is a major manufacturer of semi-trailers and transportation equipment, sectors similarly exposed to cyclical demand pressures tied to freight volume, fuel prices, and broader economic conditions.

Like Caterpillar, Wabash National's substantial layoff reflects the structural challenges facing capital-intensive manufacturers in the Midwest. The company's single large displacement event contrasts with Caterpillar's multiple notices, potentially indicating either a more abrupt restructuring event or different notification timing. Regardless, the combined impact of Caterpillar and Wabash National layoffs—totaling 2,355 workers across four notices—demonstrates that Lafayette's economy has been disproportionately vulnerable to manufacturing sector consolidation and cyclical downturns.

Diversification Into Customer Service and Healthcare

Beyond heavy manufacturing, Lafayette's layoff notices reveal the city's exposure to white-collar job losses in customer service and business process outsourcing. Alorica filed a notice affecting 147 workers, while TeleServices Direct displaced 137 workers. These companies operate in the call center and customer service sector, an industry that has experienced significant disruption from automation, offshoring, and shifting business models.

The presence of these notices indicates that Lafayette has become home to a meaningful customer service sector, but one lacking the stability of legacy manufacturing. Call centers can relocate or scale down more easily than factory operations, creating vulnerabilities that manufacturing-dependent communities often underestimate when pursuing service sector diversification.

Healthcare sector disruptions also appear, with St. Vincent Seton Specialty Hospital and Integra Lifesciences together affecting 143 workers across two notices. While healthcare employment has generally expanded nationally, these notices suggest that Lafayette experienced facility consolidations or medical device manufacturing contractions that eliminated positions despite broader sector growth.

Manufacturing Concentration and Industry Vulnerability

The data reveals a critical structural problem: of the identified industry breakdown, only 326 workers across three notices appear under the manufacturing category in the formally classified data. However, this dramatic undercount reflects data quality issues—Caterpillar, Wabash National, ZF Active Safety & Electronics US LLC, and US Arconic are all clearly manufacturing operations, collectively affecting approximately 2,919 workers. The actual manufacturing sector represents roughly 74 percent of Lafayette's tracked layoffs, not the 8 percent the formal industry classification suggests.

This concentration in manufacturing represents both Lafayette's historical economic foundation and its ongoing vulnerability. Manufacturing provided stable, union-represented employment for decades, enabling home ownership and middle-class stability for workers without four-year degrees. As manufacturing has contracted, automated, and relocated, Lafayette has struggled to develop equivalent replacement employment at comparable wage levels.

ZF Active Safety & Electronics US LLC and US Arconic LLC (which filed revised notices in 2025) together affected 406 workers across two notices, representing automotive supply chain and specialty metal products manufacturing—sectors increasingly pressured by supply chain consolidation and competition from lower-cost producers.

Historical Patterns: The 2009 Crisis and Ongoing Volatility

Lafayette's layoff history reveals a pronounced clustering around the 2008-2009 financial crisis. Six notices filed in 2009 represented a dramatic spike in workforce disruption, followed by a relative lull through the early 2010s. This pattern mirrors national trends, reflecting how the Great Recession devastated manufacturing employment and automotive supply chains.

The distribution pattern shows sporadic rather than steady layoffs: single notices in 2008, 2011, 2012, 2014, 2015, 2019, 2020, and 2021 suggest that Lafayette experienced ongoing but intermittent disruptions rather than continuous contraction. The cluster of three notices in 2022 and resumption of activity in 2024-2025 with two additional notices signal renewed instability, possibly reflecting post-pandemic supply chain adjustments and ongoing manufacturing sector uncertainty.

Notably, only 13 years separated the first notice (2008) and the most recent (2025), yet the 22 notices spread across those years show no clear recovery trend. Each uptick in notices correlates with either national economic cycles or sector-specific disruptions, suggesting Lafayette lacks structural insulation from broader economic shocks.

Local Economic Impact: Multiplier Effects and Community Stability

The displacement of 3,938 workers triggers significant secondary economic impacts beyond the immediate job losses. Manufacturing and logistics workers typically earn wages between $45,000 and $75,000 annually—income levels that support local retail, housing, services, and tax bases. When Caterpillar or Wabash National reduce workforces by hundreds, the lost income ripples through the community through reduced consumer spending, lower housing demand, and declining sales tax revenue.

Lafayette's economy cannot easily absorb job losses of this magnitude. In years with significant WARN notices, the displaced workers represent 5-10 percent of the city's total employment or more, depending on the actual size of Lafayette's job market. While some workers successfully transition to other employment, wage replacement is frequently incomplete—service sector jobs or lower-skill manufacturing positions typically pay 20-30 percent less than lost manufacturing employment.

The concentration of layoffs among a small number of large employers means that single company decisions cascade through the entire regional economy. A workforce reduction decision made in a Caterpillar corporate boardroom in Illinois directly determines whether Lafayette families can afford mortgage payments, fund children's education, or invest in local businesses.

Regional Context and Indiana's Manufacturing Challenge

Lafayette's layoff experience reflects broader Indiana economic challenges. The state has historically depended on manufacturing far more than the national average, creating vulnerability to industrial consolidation and global competition. Caterpillar's multiple Lafayette layoffs echo the company's broader Midwest footprint reductions, which have affected Illinois, Wisconsin, and other traditional manufacturing strongholds.

Lafayette's situation differs somewhat from Indiana's most industrial cities like Gary or South Bend, which face even deeper manufacturing decline, yet resembles the experience of mid-sized Midwest manufacturing hubs struggling to transition away from capital-equipment and transportation equipment production. The presence of white-collar job losses in customer service and insurance reflects attempts at diversification, but these sectors have proven less stable and lower-wage than the manufacturing they partially replaced.

Indiana's WARN notice activity overall reflects similar patterns to Lafayette: significant 2008-2009 crisis clustering, subsequent volatility, and ongoing vulnerability to manufacturing sector pressures. Lafayette's 22 notices place it among the state's more significantly affected metros, though smaller than the impact experienced in larger industrial centers like Indianapolis or Fort Wayne.

Looking Forward: Structural Vulnerabilities and Policy Implications

Lafayette's layoff history reveals an economy structured around large manufacturing employers with limited ability to absorb major workforce reductions. The city has not experienced anything approaching economic diversification sufficient to offset manufacturing job losses. Instead, it has added customer service and some healthcare positions that offer neither the wage levels nor the stability of legacy manufacturing employment.

The two 2025 notices suggest continued volatility ahead. Ongoing supply chain adjustments, competition from lower-cost regions, and technological automation continue pressuring the types of manufacturing operations that employ Lafayette residents. Without significant economic restructuring toward higher-value sectors or technology-intensive manufacturing, Lafayette faces continued exposure to the cyclical, employment-destructive forces that have characterized its economy since 2008.

The WARN notice data captures only formal layoffs of 50 or more workers, meaning Lafayette's actual job displacement exceeds the 3,938 workers formally tracked. Smaller closures and reductions escape these reports entirely, yet cumulatively they represent additional economic stress on a community struggling to transition from its industrial past.