Jul. 14--Large businesses are cutting local employees at a record-setting pace, often flooding the market with workers possessing nearly identical skills -- who then have to compete with each other for scarce jobs.

More than 2,700 employers laid off 50 or more California workers in the first five months of 2009, the state's largest number of mass layoffs for any similar period on record, new federal figures show.

In the first three months of the year alone, nearly 127,000 California workers lost their jobs during such mass layoffs, also a record, according to state data.

The biggest hits have come in manufacturing, construction, retail sales and banking. A lot of local specialists in those industries are competing with one another for a small number of jobs -- if they haven't given up on their specialty altogether.

"Even going down to Jack in the Box, they were inundated with applications from people with bachelor's degrees," said Lowell Dixon, who lost his supervisor job at solar panel manufacturer OptiSolar's nascent Sacramento plant in January. "There is a mass number of people out there."

OptiSolar is a good example of the type of mass layoff that can hit a region hard: a large employer that does a type of work that no one else is doing locally.

"(Mass layoffs) for specialty jobs are very harmful," said Sanjay Varshney, dean of California State University, Sacramento, College of Business Administration. He said Sacramento can't easily absorb jobs in specialties that no longer exist locally.

In such cases, Varshney said, "The economic damage is much higher."

Besides Intel and OptiSolar, the largest recent or planned mass layoffs in the Sacramento region were from big box retailers like Mervyns and Gottschalks, which recently went out of business. The area also is losing a huge AAA call center near Elk Grove, and multiple banks and car dealerships have closed or cut a large portion of their staffs.

Mass layoff figures are different from the unemployment tallies that come out each month. Unlike unemployment figures, they include only layoffs of 50 workers or more from the same company within a given month.

In some instances, particularly for low-skilled jobs such as retail sales, it doesn't matter much whether 10 small companies lay off 10 workers, or one large company lays off 100, Varshney said.

In fact, since many large employers are supplied and supported from outside the area, a mass layoff at a large employer of low-skilled workers can be easier to absorb than the loss of small businesses with local supply chains.

The exception to that rule is a place like the Toyota-General Motors plant in Fremont. GM recently pulled out as partner to that plant, and Toyota said it might leave as well. The plant employs 5,000, and tens of thousands of other regional jobs are directly tied to providing it with supplies, said Jeff Michael, director of the Business Forecasting Center at the University of the Pacific's Eberhardt School of Business.

"There is a ripple effect," Michael said. "That's a big one for the region."

Dixon, the former OptiSolar employee, is practically drowning in the ripple effects caused by manufacturing job losses. He's trying to support his family and two small granddaughters with government aid, but he's worried he soon won't be able to pay even his modest bills.

"I don't have the money," said Dixon, who lives in Penn Valley, adding that one of his most recent rejections was from a bus driving company. "I've only gotten two interviews, and I've put out thousands of resumes."

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Call The Bee's Phillip Reese, (916) 321-1137.

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