Geronimo took a swipe at explaining how the business cycle builds up staffing problems that don't get solved until the economy tanks, and employers can re-size their organizations while the media's overwhelmed. Another NY Times Editors' pick
- Geronimo
- California
NYT Pick
After 20 years as head of HR at a couple Silicon Valley companies, some hidden aspects of layoff and re-hire decisions:
1) In bull markets, companies concerned about their stock price avoid layoffs, even when they know they need them. They don't want to spook analysts, shareholders and investors with a layoff--a bearish sign that could tank the stock price. So, when the economy turns down, a lot of postponed housecleaning needs to be done.
2) Layoffs traumatize management as well as rank-and-file. Re-staffing is done with great caution, to avoid triggering more layoffs.
3) When a layoff comes, it's always the least productive, most difficult employees with the most outdated skills to go first.
4) Management knows this, so when the recovery starts, there's a strong preference to hire people who are already working, and skepticism about people idled by layoffs.
In an economic downturn, all companies are affected. That reverses the negative spin, so suddenly a layoff shows how tough and prudent the management is, which reassures stockholders and analysts--the reverse effect from a layoff during a bull market. And, the risk of being singled out for unwelcome media attention is far less.
The (liberal?) press covers the un-employment rate, but it's the employment rate--63%, lowest in decades--that reveals the number who have abandoned the workforce.
The biggest contradiction: employers want smart, high-skill employees, but the workforce needs more dumb jobs in the economy.
In an economic downturn, all companies are affected. That reverses the negative spin, so suddenly a layoff shows how tough and prudent the management is, which reassures stockholders and analysts--the reverse effect from a layoff during a bull market. And, the risk of being singled out for unwelcome media attention is far less.
The (liberal?) press covers the un-employment rate, but it's the employment rate--63%, lowest in decades--that reveals the number who have abandoned the workforce.
The biggest contradiction: employers want smart, high-skill employees, but the workforce needs more dumb jobs in the economy.
And here's the link:
http://www.nytimes.com/2012/04/07/business/economy/us-added-only-120000-jobs-in-march-report-shows.html?_r=1&comments#permid=78
