Avoiding Layoffs

The New York Times reports on employers that are taking steps to avoid layoffs by spreading around some of the economic burden:


Of course, at companies that hand out exorbitant salaries, bonuses, and special deals for executives high on the organizational chart, there is a natural starting place for cuts.  But there may come a time when even employers that have fair salary and wage structures are faced with the question of layoffs vs. trimming compensation.  For many reasons, the latter is far preferable.

Layoffs can have serious economic and psychological consequences for affected individuals.  When reporter Louis Uchitelle began researching his book The Disposable American: Layoffs and Their Consequences (2006), he did not anticipate that he “would be drawn so persistently into the psychiatric aspect of layoffs.”  But he soon understood that the “emotional damage was too palpable to ignore.”  For the suddenly unemployed, “a layoff is an emotional blow from which very few fully recover.”


Furthermore, Uchitelle found that “layoffs damage companies by undermining the productivity of those who survive but feel vulnerable, as well as the productivity of those who are laid off and get jobs again.  All lose some of the commitment, trust, and collegial behavior that stable employment or the expectation of stable employment normally engenders.”

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