Call #15: Staying Encouraged During a Prolonged Job Search  

We welcome any comments or questions you might have on tonight’s topic.  Just type them into the box provided below.  Thanks.

Terry

Terry

Rant of the Month- Layoff Missteps Offer Substantial Opportunity

~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

The meltdown of the economy may also have melted the business sense of those responsible for layoffs in some of America ’s largest and, until now, most admired firms. In New York alone, 250,000 jobs are essentially lost.

The deeper problem is that companies are letting their employees go with little or no notice. They clean out their desks and work areas and are escorted off the premises – all within hours of the decision. No outplacement, minimal severance (or conspicuously capped severance for the longer term employees). The obvious exceptions are C-level execs with fat exit contracts having little to do with their performance.

A post holiday layoff explosion is anticipated to kick-in and, if these layoff resource-lite business decisions continue, we believe the resulting loss of productivity and long-term choices of a new generation of employees reluctant to return to corporate life will hurt stockholders and employers for years to come. Survivors will certainly take note of how their colleagues are treated and will be more likely to jump at the first opportunity.

An article on MSNBC Guilty and stressed, layoff survivors suffer, too was included in SHRM’s knowledge management newsletter which noted “A flurry of research after the economic downturn of the 1990s found that layoff survivors reported high levels of distrust and lower levels of motivation and engagement. Absenteeism went up, productivity went down.”

And John Zappe’s article, Guilt, Anger Cuts Productivity Says Layoff Survivors noted that:

• 64% of surviving workers say the productivity of their colleagues has also declined.
• 81% of surviving workers say the service that customers receive has declined.
• 77% of surviving workers say they see more errors and mistakes being made.
• 61% of surviving workers say they believe their company’s future prospects are worse.

Productivity will suffer measurably as firms’ managers fail to re-engage their remaining workers. And those rushed out the door are likely to tell their friends (and their friends) affecting the choices of the best and brightest candidates – who always have a choice.

One notable exception to the knee-jerk layoff trend is Bank of America. B of A ought to be highlighted for their efforts to retain some semblance of intelligence in executing layoffs. Having agreed to absorb Merrill Lynch in a moment of public panic, B of A seized an opportunity and, while it was inevitable that some fallout would take place, their actions were planned, measured and transparent in the face of a failing business economy.

We think B of A is more likely to reduce fears from within. (Unfortunately, the recent announcement about their layoff, as reported in Workforce Management Online, “Bank of America to Ax 35,000 jobs in Newly Merged Firm”, (as well as in other media) had the typical “scream-for-attention-headline” that is terribly misleading if you failed to read the details – and the details are critical.

The B of A downsizing is over three years with efforts to maximize the natural turnover and retirements (which might account for more than half). Promises of severance and support where necessary were made (and reported in the Workforce article). There are more details in the B of A approach but the point is easily made that a firm’s reputation as an employer of choice is not just about how they handle the good times.

Recruiters quickly recognize that the doors to many firms that have handled layoffs poorly are wide open and the pools of candidates are waiting for them. The survivors will easily give up the names and contact info for the best that have left as well as the best that remain.

Top recruiters with any amount of sense also realize that if their company can’t live up to its EVP during these difficult times then it might not be the best place to be trying to woo the next crop of top talent as the economy turns.