Embark Behavioral Health has laid off managers and administrative staff in its senior and middle management ranks. The company is also closing several locations.

The Phoenix-based youth behavioral health provider laid off about 60 people, providing notice last Wednesday. Impacted roles include human resource and recruiting positions, information technology and facility executive directors, people familiar with the matter tell Behavioral Health Business.

Embark Behavioral Health is also closing six locations: its five outpatient locations in the Los Angeles region and a residential treatment facility in Oregon.

Representatives of the company confirmed that it conducted “a targeted reduction-in-force” meant to “streamline operations and optimize resources.” It did not confirm or deny specifics about the positions or the number of employees impacted.

“While this was an incredibly difficult decision, it reflects our ongoing commitment to being responsible stewards of our resources and ensuring that we can continue to provide a high level of care to those who need it most,” Scott Filion, CEO of Embark Behavioral Health, told BHB in an email. “We are as resolved as ever in providing the highest quality of care and positive outcomes to families who have and will entrust us in their care.”

Embark is providing transitional benefits to those impacted by the layoffs, according to the company.

The move comes just less than two years after a new private equity owner took over the company and almost exactly two months after a new CEO took the reins.

In February 2023, BHB reported that the private equity firm Consonance Capital Partners acquired a controlling interest in Embark Behavioral Health for $400 million with a multiple range of 12- to 15-times EBITDA, sources told BHB.

A year later, the company shuttered its wilderness therapy division, some of which were intended to change licensure to residential treatment centers.

Then in the middle of August, Embark Behavioral Health announced that it hired Scott Filion, a health tech and consumer technology veteran, to succeed long-time CEO Alex Stavros. Fillion took on the job on September 10.

While Embark Behavioral Health was not implicated, the youth mental health segment, especially the resident treatment center space, has been raked over the coals by industry critics, in no small part prompted by a stinging report released by the U.S. Senate Finance Committee in June. The leader of that committee publicly pressured the U.S. Department of Justice to investigate major players in the residential treatment center segment. Many behavioral health advocates say that the criticism of the whole industry fails to account for the regulatory and economic environment created by underinvestment and lax oversight on the part of lawmakers and regulators.

Layoffs were a steady and defining theme in 2022 and 2023. The trend has continued with several notable examples thus far in 2024. Throughout the year, digital- and telehealth-focused behavioral health providers Array Behavioral Care, Bicycle Health, Akili Inc. and Brightline announced layoffs.

In May, the eating disorder and mental health treatment provider Monte Nido & Affiliates also announced it would lay off about 130 people. Most recently, the digital therapy enablement platform Alma has laid off 9% of its staff across most departments.

The recent behavioral health industry layoffs don’t appear to portend adverse things to come; rather, they reflect the wider economy. Elevated layoffs have mainly been relegated to technology companies, as many firms reconcile a new normal post-COVID. Overall, the rate of layoffs in health care is slightly down.