Are we going about this the right way?ADHERER

About the largest issue we seem to face as a nation (we, meaning the United States) is lack of confidence in our businesses.  After all, it’s lack of confidence in our financial institutions that brought about this recession in the first place.  But we need to go further.

The Federal plan seems to be geared toward stimulating the economy by giving tax breaks and injecting financial resources into various parts of the economy.  But that’s just not going to cut it.  When faced with slow economic times, many companies will elect to reduce their workforce, known in most circles as a layoff.  Whereas that certainly stems the tide of the company’s bleeding, is it a good idea?  I mean, does it actually work?

I can tell you it most certainly does not, in the long run.  It obviously doesn’t make happy people out of the people that were laid off.  But even those that weren’t still have demons to face.  Speaking as someone who’s been laid off before, and who was lucky enough not to get laid off a year ago when my company decided to cut 10% of the workforce, I can say that I am not singing any praises for my employer.  Let’s look at why.

First of all, layoffs typically come in waves.  Where there’s one, there’s usually a second, and even a third wave of more layoffs.  So anyone who was lucky enough to survive the first wave is going to be on pins and needles.  Some might think that this will motivate employees to do a better job, but it is my contention that it doesn’t.  Why?  Well, simple.  To begin with, the employee gets a big snootfull of just how much their employer is looking out for the employees’ interests… which is to say, not at all.  Push comes to shove, the company will toss you out like an old newspaper without so much as a hey-how-do-you-do.  As well, the work that the laid-off employees did does not get reduced, it gets heaped on the workload that the remaining employees already have, and I can tell you there’ll be no increase in pay for this increase in workload.  Employees begin to shoulder a greater portion of the burden for the company’s success, and are still in danger of losing their jobs at any moment.

One would think that employees can write their own destiny by being good workers.  Well, there’s several things wrong with that.  To start with, if someone’s job is itself being eliminated, then it doesn’t matter how good that person is; their job is gone, and far be it from the company to retrain that loyal worker.  Additionally, the litigious society we have built has made the layoff business not an affair to get rid of dead weight, but an HR-led campaign to lay off people of seemingly-random demographics to avoid any hint of impropriety.  When my company laid people off, the worst workers in my group stayed while some of the best ones were let go.  That makes things terrifying for those of us that are still here, and we realize that no matter how hard we work, it doesn’t make us safe from a layoff.  Instant begrudged employee.

Companies who go through a layoff also will frequently have a sudden upturn in their business afterward and will then open their doors for hiring.  How often have you seen someone get laid off only to return to their job as a contractor six weeks later?  It happens all too often, I can tell you.  My company had layoffs a year ago where my team lost two valued workers.  Today, those two have been replaced with three others, albeit less-experienced.  Does this make any sense?

But the feeling among the employees is that no one with a brain is steering the ship.  We lowly employees don’t often get in on the workings of the company at the higher levels, so we take comfort in knowing that the higher-ups know what they’re doing.  And if they don’t, it causes fear.

And what does all this fear do?  Right, it cinches up the purse-strings tighter than ever.  So now we have people that lost their jobs not spending, and we also have people that didn’t lose their jobs also not spending.  Economic downward spiral.

So what should the Federal Government do?  Well, I’m not an economist and I don’t have any great answers.  But there sure should be some sort of dis-incentive to laying off valuable workers.  Tax breaks for retraining and education.  Or tax penalties for eliminating workers if there are any openings elsewhere in the organization.  Even poor-performers could probably be valuable somewhere else in the organization… figure it out.

In the end, if this were the case, and we could all feel a little more confident that our jobs will still be here tomorrow, then we might all feel a little more generous, a little more eager to spend and stimulate the economy, and then maybe, just maybe we can get ourselves back on track.