There was a time when the word "layoff" referred to a TEMPORARY separation due to a lack of demand with the understanding that when activity picked back up you'd be recalled back to work. This was particularly common in the automotive sector and really across manufacturing. These were cyclical industries and while employers couldn't afford to pay idle workers during periods of low economic demand, they also couldn't afford to lose the skillsets. Oftentimes unions would provide partial compensation to these workers until they were recalled.
Somewhere around the mid 1990s, "layoff" became just a euphemism for permanent reductions in force/downsizing.
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