The Compassion in Furloughing Employees

When this recession is all said and done (and it will one day be truly and mercifully gone) there will be a number of trends recalled that people will examine as they attempt to get their minds around what they went through.

This can be a good thing because though business is cyclical in nature — fraught with many ups and downs — there is something about a deep downturn that is etched in our memories, becoming among the deepest and most defining moments in our lives.  Hopefully, resulting in a new appreciation for life, perhaps showing that thriftiness can build character.

What Our Great Grandparents Can Tell Us

One need only to talk with someone who was part of the now fast passing away generation that lived through the Great Depression to get a feel for how that period shaped their entire lives, even as unbridled prosperity later ruled the day…at least for a relatively short while.

The ugliness will no doubt be remembered too, sparking conversations where we’ll recall those times when large corporations were bailed out even while small businesses and middle  income folks were struggling to stay above water. We’ll also wonder just how much government really expanded during that time and whether it’ll ever contract to a more manageable and sustainable level.

Why Not Furloughs Instead of Layoffs?

But, I think one trend that will get a bit more than a passing reference will be how companies handled layoffs during that time.  Clearly, most struggling companies opt to go the mass layoff route while others try a more sensible, even humane approach by furloughing employees.

Furloughing is common with blue collar workers who sometimes are let go temporarily and called back to work later on. During their furlough (laid off) period, workers can collect unemployment benefits and in some cases work another job.

This practice has been around for decades, allowing companies to adjust workforces as needed. Employees may not particularly like being furloughed, but they know that the odds are with them that they’ll resume their employment at some point down the line.

A Bum Rap For White Collar Employees

White collar employees usually aren’t as fortunate. When management decides that money needs to be saved, one of the first things they do is cut payroll. Not cutting back on hours. Not reducing their workforce by attrition. Rather, permanently laying off significant numbers of people immediately.

I have always thought that this practice was senseless, even cruel. Generally what happens is that a portion of the company’s workforce is put out of work while the remaining employees keep working with few, if any changes. Sure, there may be the attendant salary freeze or restrictions on what days they can take off, but the majority of the workforce feels nary a pinch while a handful have their lives totally disrupted.

Particularly Disruptive For Seasoned Workers

This disruption is not easily remedied, particularly for older employees who almost always go through an extended period of unemployment and must eventually settle for a position that pays far less and offers few opportunities for advancement.

Back in 2002 I was part of a group of thirty people let go from a company, a move that I found somewhat of a relief but also a tremendous hardship. I understood that my company was going through a difficult time, but I also knew that things would change and that they would be hiring once again.

Of course, there is always the case made that I (and other long term employees like me) would eventually be replaced by someone who made less money, but in the majority of situations laying off people affects employee morale, puts a drag on company earnings, and disrupts lives.

I don’t believe that companies owe their employees their jobs, but I think it does say a lot about a company who does everything within their power to keep their workforce in place even through difficult times.

State Employees, Retail Workers Furloughed

This past week I learned that two family members were preparing to be furloughed, unusual moves for their fields as one works for a large retailer while the other is in state government. For my retailer relative, she’ll be having her days cut back from five to four while my government relation will be taking scheduled days off without pay over the coming months.

Certainly, no one likes to take a pay cut but in this case things turn out a little differently — no one loses their job. True, there is no guarantee that additional furloughing won’t happen nor have lay offs been ruled out, but for now, everyone is employed.

A Company’s Strength? Its Workers!

I find something good, even reassuring about a company who takes a page out of the blue collar handbook and tries it with office workers, sales staff, store employees and traditional white color employees. And, I think showing employees that you’ll stick with them through thick or thin builds a much more loyal and engaged workforce, one that will do their jobs better and, ultimately, increase a company’s bottom line.

Good business sense is for a company to recognize that its employees are its number one asset, something not to be discarded when things get tough but kept in place in order to build a strong, committed body of workers.

Let’s Bring January To A Close!

One day is remaining for this first month of 2009 and I cannot properly express to you what a whirlwind of a month that it has been for me.

Thankfully, my business remains stable, but the dark clouds are on the horizon. If I pay too much attention to the daily layoff reports, I can quickly grow discouraged. Instead, I’ve chosen to focus on those things which are much more uplifting or at least those things which have nothing to do with the economy!

The Time To Launch A Business Is Now

I am discovering what seems to be a greater number of people who have decided to go into business for themselves.  My cousin is partnering with a friend who launched a “green business” after spending the last twenty-five years in retail. He has had the unfortunate experience of working for two retailers who went bankrupt, though those jobs disappeared well over a decade apart.

I think a lot of people are deciding that they’ve had enough and have decided to venture out on their own. After all, what have they got to lose? Answer: steady pay, an ungrateful boss, crabby co-workers, lousy commute, etc. Best wishes with everything, Jerry, your past successes heading up various retail locations will work to your advantage.

As far as my current group of clients, I’ve encouraged everyone to hang in there. It is easy to focus on the negative while missing opportunities that are sitting right before your eyes. This is a good time to snap up a business (such as an online store or a blog) as prices are much lower and some people want to get out. I like to keep my eyes on Sitepoint to see what is out there.

Prepare Now And You’ll Prosper Later

I truly believe that people who position themselves now for the coming recovery — and the recovery will come — are those folks who will shine later on. I’ve come across any number of people who are panicking which can lead to irrational behavior. Don’t be too quick to make a drastic decision when the heat has been turned up in your life!

I distinctly recall the tough recession of the early 1980s and it was worse than this one, but we recovered and the economy eventually soared. That gave way to the go-go 1990s when the technology sector boomed. I am, however, cautious about this pork laden “stimulus” bill making its way through Congress — what impact that it will have on the economy several years hence is the great unknown.

Taking My Business To The Next Level

Besides meeting all of the needs of my present clients, I am keeping my eyes open for more work. But, instead of actively pursuing specific jobs at the moment, I’m gauging what is out there and considering how I can best accommodate an increased workload.

Part of that review involves me reassessing my business and planning for the future. I’ve never done this before (at least that far out), but I’m looking at establishing attainable goals that I want to reach three years or more down the line. I can see that laying a solid plan now will help me move in that direction.

Not Ready To Put Out The Help Wanted Sign

To this day, I’ve been a one person business but I’m mulling taking on — gasp! — at least one employee or perhaps contracting out work. Don’t send your resume to me just yet, because I don’t have anything in place right now and I can’t see me going that direction before the year is out.

I can recall quite a number of conversations I had with people early on (I launched my business in November 2002) where I insisted I would never take on staff. But, some of the projects I could end up handling would be all the more easier to do if I had people working with me. I write like the dickens all throughout the day, but some of those assignments could be farmed out to a qualified writer.

I suppose what we think is right for the moment will apply always, but just thinking about working with someone is a fresh thought, one that involves a lot of consideration. If and when I do make a change you’ll know about it here.

Enjoy your weekend.