Minimize your layoffs, employers
Reader Dave sends this nice letter to Obama's change.gov Web site, a propos of Saturday's column on layoffs.
Dear President-elect Obama,Normally, I do not comment or send letters to elected officials, but since we are all looking for positive change in America, I felt it was time for me to change and offer an opinion. There is a column in the Baltimore Sun on November 22, 2008, written by Jay Hancock. "Butcher, baker, unemployment line maker." Mr. Hancock writes a financial column for The Sun and I have found him well informed and balanced with his writing.
The column strongly suggests that business in America look at other alternatives to saving money during this down time, rather than automatically cut jobs and move people into the ranks of the unemployed. He quotes Adam Smith, a Scottish philosopher. Liberally paraphrasing, if we continue to lose jobs there will be less people to participate in the recovery of the economy. I know this sounds all too simple and would be shouted down in some quarters, but we do need a balanced & thoughtful approach to our recovery.
If a company, large or small, knows that financial goals are not going to be realized, why not look to other areas to manage expenses, rather than take the easy way to cut jobs. Just this week, I heard of an individual who was a top performer in the position, but was let go due to a salary that was at the top of the pay scale. Being escorted to the parking area, this individual was reminded of the inconsistencies of some management teams, when he saw all of the executives cars being cleaned and detailed. Now is this person going to be able to purchase Christmas gifts from the local Main Street gift shops or invest on Wall Street? Probably not. Would the retention of this person and the savings of not detailing cars balance the books? No. However, an employed person will look to buy a coffee at the local shop, continue with cable service and maybe eat out once or twice a month.Unemployed, you start to cut expenses. No man, no firm is an island. We are all interconnected. I have been out of work since July due to a downsizing. Now, I will admit I am currently evaluating my options and more than likely will make a career change, but my timetable is is not of my own doing. I have not applied for unemployment, since I am trying to figure out what I want to be when I grow up, so I am not counted in the unemployment numbers. Some people tell me I foolish not to apply, but I don't believe it is ethical to apply if I am not seriously job searching. I am fortunate at this stage to have the opportunity to take some time off to regroup, but many, many people do not have the time and the greater the ranks of the unemployed that more difficult our recovery will be. I do think America wants change, but we are also looking for accountability & responsibility from the private & public sectors. We can also handle the truth. Be straight with America. That is why you were elected.
A long E-Mail. I do hope someone on President-elect Obama's team does get an opportunity to read Mr. Hancock's column and advise Mr. Obama. If we even get a small percentage of companies to reconsider their thinking, I believe all of us will be better off in the long term.
Congratulations and Good Success with the difficult tasks ahead.
Comments
I have never met an executive who didn't get stomach acid from layoffs.
Problem is, a business has to cut costs where the costs are, and for many businesses the largest possible area of cuts is payroll (and the accompanying benefits and tax costs).
In many businesses, cutting senior level executive comp in half would barely make a dent.
Cut marketing? A common response and often a bad response?
Turn off lights, limit long distance phone calls, cut training...... peanuts.
We all want miracles at Christmas, problem is, there are few economic miracles.
Posted by: save_the_rustbelt | November 29, 2008 11:21 AM