Labcorp to lay off 239 New Jersey workers while 'consolidating testing operations'

Labcorp is planning to lay off dozens of workers from a New Jersey facility by the spring of 2025, according to a recent filing with the state’s labor department in accordance with the federal Worker Adjustment and Retraining Notification (WARN) Act.

All told, by the end of April 2025, Labcorp will have reduced its headcount at the Somerset location by a total of 239 employees.

The layoffs are slated to be spread out across multiple tranches, and they’ve already begun: One swath of workers began receiving their notices last week. Another group will be laid off throughout the month of February 2024, and the final group of layoffs is set to take place between March 31 and April 24 of 2025.

In a statement sent to Fierce Medtech, a Labcorp spokesperson said, “This decision, while difficult, optimizes our operations and ensures we are able to meet the needs and expectations of our customers by utilizing our global capacity and scientific centers of excellence across the organization.”

The Somerset facility provides laboratory testing services. In the WARN notice, which was shared with Fierce Medtech by the labor department, Labcorp attributed the layoffs to a “termination of operations,” noting that it’s in the process of “consolidating testing operations” and therefore moving some of the testing work currently performed there to other locations.

The affected workers will be able to apply to other jobs within Labcorp, with access to the same company-provided benefits, per the filing, though their salaries may differ.

These 239 layoffs encompass another set of cuts at the Somerset site that the diagnostics giant disclosed earlier this year. Another WARN filing with the state of New Jersey in August noted that 78 employees would be let go from the facility between Nov. 17 and Dec. 1—which lines up with the first swath of layoffs disclosed in the more recent notice.

The move to consolidate some of its lab testing work comes as Labcorp has reported solid revenue growth but plummeting profits throughout 2023.

As of the end of the third quarter, according to its most recent earnings report, the testing giant had reeled in revenues of more than $9.1 billion for the first nine months of the year, representing a 2.2% boost over the same period last year. The company linked that growth to both its external M&A moves and internal base business, though improvements in the latter were almost completely offset by still-dropping sales of COVID-19 diagnostics.

But those revenues weren’t enough to cancel out Labcorp’s losses. After the first nine months of 2023, its net earnings stood at just over $585 million, less than half of its profits of $1.2 billion a year ago. Once again, reduced COVID testing was largely to blame, according to Labcorp, while an accompanying drop in its operating cash flow was also linked in part to the spinoff of its clinical development business into standalone company Fortrea.

Editor's note: This story was updated to include a statement from Labcorp and to clarify the planned dates of the layoffs.