The fourth quarter is a major inflection point. The U.S. economy is moving out of its bounce-back recovery from the coronavirus depression and could be returning to slower growth and recovery or it could be moving toward a recession.

The state of play: We are about to see a second wave of job losses — this one more likely to permanently push millions out of the labor force, lower wages and leave long-lasting scars on the economy.

• Round one was a swift reckoning that left 20.5 million Americans without a job after one month.
• Round two has been a slow burn that has seen net employment gains but increasingly larger numbers of long-term unemployment and permanent job losses, Americans falling out of the labor force and strategic layoffs combined with small businesses shutting their doors.

On one side: The coming October jobs report is expected to show employers added 625,000 jobs last month — demonstrating a labor market continuing to slow but still moving in a positive direction.

On the other side: Layoff announcements picked up at the end of October, with ExxonMobil, Chevron, Charles Schwab and Raytheon all announcing the elimination of thousands of white-collar jobs.

• Those followed major layoffs from Wells Fargo, Goldman Sachs, Salesforce, Allstate and WarnerMedia.

The intrigue: Rather than a panic-driven effort to cut costs and stay above water, these job losses are largely a result of companies reducing headcount after mergers and acquisitions or as part of a longer-term strategy.

• Businesses have been positioning themselves for an increasingly competitive landscape by boosting productivity and reducing costs, so they've been cutting jobs and investing in new technology, as I wrote in September.
• "Almost every client that we deal with, irrespective of sector, is trying to drive cost down and make their products and services more affordable," Tim Ryan, U.S. chair and senior partner at PwC, said during a September call with reporters.

By the numbers: In the first half of 2020, more than 3,600 companies filed for bankruptcy, according to legal services provider Epiq, and the pace has picked up since.

• In June, just over 600 companies filed for bankruptcy protection, up 43% from June 2019.
• In September, 747 companies filed, a 78% increase over September 2019.
• “These commercial filings are primarily small businesses that do not have access to capital or stimulus," Deirdre O’Connor, managing director of corporate restructuring at Epiq said last month. "Unfortunately, those bankruptcies will continue to rise in the current economic environment."