Employee Welfare

How I/you Use Facebook

2011-01-02T22:56:00.000-08:00

Facebook has to be the most talked about, and the most misunderstood, web service/platform right now. If you haven’t gotten drawn in by the hype, it may surprise you to learn that many people have already found Facebook to be an essential addition to their web working toolbox. Why? Because the Facebook social networking experience can be precisely what you want to make of it. Think of Facebook as a professional tool, and that’s what it is. It doesn’t matter how millions of high school and college students are using Facebook to get out of doing homework. You can make it into whatever you want, even your own personal media broadcasting channel.

Let’s look at 12 ways Facebook can benefit the web worker, particularly those who are home-based. The more connected you are to your co-workers and clients without being intrusive, the better your working relationship.

Note: you may need to have an existing Facebook profile to follow some of these links.

Think of it like personalizing your desk. You can’t help it. When you walk by someone’s desk, your eye is drawn to the pictures and the way they have personalized and organized their space. You pick up on clues to their lives without realizing it. Mary is a Mom whose desk is filled with pictures of two young children, and there are “To Mommy” pictures pinned to the side of her cubicle. You know what her weekends are probably like. John is still dating his high school sweetheart. He likes to scuba dive and he got some great shots of his last trip to Bonaire. You can see the paperback that Bill is reading on the corner of his desk. “Hey, I’ve been meaning to read that. Can I borrow it when you’re done?” Sally has a collection of labels from her favorite wine bottles. You know what to get her for her birthday.

Only display on your profile what you’d put on your desk. Just because Steve owns a picture his buddy took of him getting sick after an all-night party doesn’t mean he’s going to frame it and put it out for his co-workers to admire. Don’t add anything to your profile that you wouldn’t display for your supervisors, co-workers and clients to see as they’re walking by your work environment.

Look for old co-workers and current connections. I found more contacts on Facebook this way than I did on LinkedIn. Former colleagues have “Googled” me, and after a few emails to catch up we don’t communicate again. By adding these people to Facebook, I feel more connected to them without having to actively maintain a conversation via email. Look for business opportunities out of shared interests.

Add friends selectively. Contrary to popular belief, Facebook isn’t about “collecting” friends. There’s no reward for quantity, and you can have a rich experience on the platform with only a handful of connections. The quality of your Facebook experience will be based on the quality of the people in your network. Create a limited profile for those people that you are on the fence about whether to include. By default your limited profile contains everything in your full profile, so take the time to edit it down. annsys.com

Add apps selectively. Right now, there are over 2000 apps you can add to your Facebook profile. The temptation may be to try them all. Don’t. Just because you can add Love Quotes to your profile, it doesn’t mean you should if you want Facebook to be a professional tool for you. Pick apps that won’t waste your time when you visit your Facebook home page, so avoid those that involve playing games. Read/Write Web offers a selection of top apps for work. Read the app description carefully and know exactly what you’re getting, and what the privacy settings are before you go. It helps to see how your contacts are using the app first. But never fear, worst comes to worst you can remove an app as easily as you added it.

Think of your apps in two ways…what do you want to see (that will appear on your Facebook home page) and what do I want the world to see (that will appear on your profile)? You might consider adding an app that you don’t display on your profile at all, but it uses the collective wisdom and usage patterns of your network to provide you with valuable information. Or, if you visit your Facebook home page often it can help keep you organized having nothing to do with your friends’ actions.

Edit your news feed preferences. You don’t necessarily have to know the moment someone adds a new picture, but you may want to know when they’ve made a new connection you may have in common. Click the “preferences” button on your Facebook home page and use the sliders to give preference to the type of information you want. The more you fine-tune this information, the less time you’ll waste sifting through useless updates.

Edit your profile and security settings. Give careful consideration to exactly who sees your profile and when. Don’t take the default settings which tend to expose more information than you may be comfortable. Take the time to go through each link in the Privacy area and make necessary adjustments. Maybe you don’t want people who are casually searching to know who your friends are or “poke” you. Maybe you don’t want a public profile (accessible to people who are not on Facebook). Facebook can come back to bite you as Miss New Jersey learned. This is especially true if your primary network is geography-based. It’s one thing to share your full profile with everyone who went to the same college or high school you did, it’s another to share your profile with everyone in the New York City metropolitan area.

Incorporate the tools you’re already using into your profile. Web workers like playing with all the latest toys. Do you blog? Do you Twitter, Pownce or Jaiku? Do you read feeds? There are Facebook apps available for all these services. If you have already use these tools professionally, why not add them to your Facebook profile? After you add the respective app, you simply do what you were already doing and let the app do the work. You can see the Twitter updates from your Facebook contacts without necessarily following their updates in Twitter itself. If your blog is on WordPress.com, you can add the WordPress app and your posts will automatically be pushed to your Facebook profile, along with recent comments. If you don’t host your blog with WordPress.com, you can easily use the built-in Notes application to post your blog feed as you publish. It will let your contacts know through your mini-feed when you’ve posted a new entry. Since your friends can edit their news feeds as easilly as you can, they can control how much of your life they really want to see. annsys.com

The Google Reader Shared Items app publishes to your profile those items you’ve shared in Google Reader, as the name implies. Do you think your contacts would like to read that interesting post? Don’t disturb them by emailing them, click the “Share” button in Google Reader and now it’s right there on your profile with minimal added effort on your part. The “Top Shared” panel takes a del.icio.us/popular approach to showing the most shared posts across everyone who has installed the app.

Join Groups related to your business interests. Many groups on Facebook are nonsense, but there are quite a few that can provide useful information and professional connections. Don’t miss the already existing groups for our parent site, GigaOm and sister site NewTeeVee. Each group can feature a Wall (like a guestbook…a continuous scroll of messages) and threaded discussion lists. Rather than trying to search for groups, watch the groups that your friends are joining, as often you will find them of interest for yourself. After all, they’re in your contact list because you have something in common, right? You might even think about using Facebook to virally address a business cause, as some are doing in their effort to save Business 2.0 magazine from going under. I only wish there was a way to see updated discussion threads on one screen rather than clicking group to group.

Limit time wasted on Facebook. Facebook can suck you in easily. Remember, you have work to do. You won’t help your career if you fall behind on projects because you were too busy playing in iLike. If you find that you’re spending too much time reading Facebook message boards or reading about your friends’ favorite book selections then set limits for yourself. Facebook is a black hole. In order to get the most of Facebook, you have to be on the platform. Consider the Facebook toolbar for Firefox which will notify when you have a reason to go check the home page. You can also work with Facebook from your mobile phone, so think about babysitting your profile while you’re waiting in line or otherwise bored and not being productive anyway.

Be philanthropic. And look good to your friends while doing it. Can Facebook change the world? Probably not. But you can do your part and show it off. You can add the Causes app to specifically benefit nonprofit organizations. You can join groups that stand for actions you believe in. Use your Facebook profile to show the best side of you to your contacts, and if the environment or a cause benefits from your actions then all the better.

Ask Questions. Tap into collective intelligence with the My Questions app. Don’t know the best resource for a particular problem? Maybe your network can provide some insight. Many of us have used our blogs for this very purpose. Asking your question on Facebook instead filters out the general public, and doesn’t leave a trail for Google to follow. annsys.com

Look for events. It’s not all concerts. There’s some opportunity for good, face-to-face business networking if you’re open to it. If you are already use the Upcoming.org site to find and track conferences and other events you can add that information to your profile. Or you can use Facebook’s built-in events application to see what conferences and events your connections may be attending. Last week I attended a wonderful NTEN (Nonprofit Technology Network) webinar that I only knew about thanks to Facebook.

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100 Blog/Podcast Topics I like YOU Write

2011-01-02T22:41:00.000-08:00

1 How I Use Facebook
2 Ways I Embrace My Audience
3 Should My Town Use Social Media?
4 A Community I Love
5 Technology That Empowers Me
6 How Flickr Did it Right
7 How Best to Comment on a Corporate Blog
8 Ways to Save a Bad Time at a Conference
9 How I Find Blogging Ideas
10 Somebody Has to Say It
11 My Children Will Do it Differently
12 How Schools Could Use Social Media
13 The Best Parts of Marketing
14 Presentation Skills for a New Conversation
15 How I Find Time to Make Media
16 Empower Your Best Customers
17 After the Event- Carrying the Conversation Forward
18 Just Jump Into Podcasting- Heres How
19 My Community and How You Can Engage It
20 Twitter Jaiku Pownce Facebook- And Then What
21 Making a Miniseries
22 If I Were an Advertiser Today
23 My Mother is On Facebook
24 Does a Big Brand Need You
25 Books I Want to Write
26 Serving the Deep Niches- How I Do It
27 How Women Use Social Media
28 A Hard Look at My Media Habits
29 If I Were a Television Producer
30 Social Media Marketing vs Traditional Marketing
31 Elements of a Marketing Campaign
32 Social Media Campaigns are NOT Traditional Campaigns
33 Idea Making and How I Make Something
34 What I Spend Money On
35 Do Rock Stars Need Social Media Strategies
36 How I Use My Website
37 Book Shopping- Buy These Books
38 MTV Changed the World in the 80s- Here is What Comes Next
39 How I Process Blogs and What I Do With All That Info
40 Ten Guilty Pleasures
41 The Internet Application I Havent Seen
42 If I Worked for a Venture Capital Firm
43 My Day Job Versus My Passion
44 The Difference Between Fark and Truemors
45 Fixing Conferences
46 Making Marketplaces for Media Makers
47 When I Feel Frustrated
48 Branding Strategies I Use
49 Your Ideas And My Ideas- How We Play Together
50 Friends I Cant Wait to Meet

51 The Art of Chaos
52 Telling My Boss About Social Media
53 Could I Quit My Day Job
54 When to Cut Back on Web Habits
55 Breaking Down My Favorite Blog
56 Explaining Social Media to Your Chamber of Commerce
57 Non-Internet Equivalents to Internet Tools I Use
58 Considering Media for the Rest of the Globe
59 Twitter is Too Simple- Twitter is Just Right
60 The Future of Podcasting
61 Video Made Simple
62 Facebook Applications I Love
63 You Are Here
64 Blogging Tactics- How to Keep it Fresh
65 I Want to Brag A Minute
66 Who Says What About Your Brand
67 Tools for Blogging
68 Wordpress Plugins I Use And Why
69 Media Topics That Need More Coverage
70 Comments versus Blog Posts
71 How I Drive Traffic to My Site
72 News- Is it Useful and How I Might Fix It
73 Which TV Network Gets Videoblogging and PodCasting
74 Franchising My Media
75 Handling Critics
76 My Audio Tricks
77 Ning Sites I Like and Why
78 Controlling My Brand
79 Sharing and Contributing
80 How Twitter Improved My Blog
81 Email After Twitter
82 Facebook Video Improved My Social Network
83 Letting Go
84 Downtime- What I Do Offline to Recharge
85 How I Went From Very Shy to Less Shy
86 The RIGHT Number to Track for Podcasting
87 PodCamp Has to Change
88 Shaking Things Up
89 Joining A Network- Things to Consider
90 Newspapers and How I Would Change Them
91 Interview With a Veteran
92 The Countries of My Social Media World
93 Giving it Away
94 Consulting Strategies for Social Media Experts
95 Turning Media into a Business Card
96 Podcasting on a Budget
97 For Every Excuse a New Strategy
98 Just When I Think I Am Done
99 Buying Gear- My Shopping Tips for Podcasters
100 When is Free Better- When Not

Government and Cost-Cutting

2009-06-14T19:06:00.000-07:00

Government officials have mastered the cost-cutting game, or should I say the cost-non-cutting game. The trick they have learned is that whenever budget or tax cuts are proposed, they threaten to cut the most critical expenditures.

Now, as I have pointed out, such behavior in a private company would result in one’s termination.

When I was in the corporate world, if I wanted extra funds for my projects, I would have to go in and say “Here are all my projects. I have ranked them from 1-30 from the most to least valuable. Right now I have enough money for the first 12. I would like funding for number 13. Here is my case.”

But the government works differently. When your local government is out of money, and wants a tax increase, what do they threaten to cut? In Seattle, it was always emergency services. “Sorry, we are out of money, we have to shut down the fire department and ambulances.” I kid you not — the city probably has a thirty person massage therapist licensing organization and they cut ambulances first. In California it is the parks. “Sorry, we are out of money. To meet our budget, we are going to have to close down our 10 most popular parks that get the most visitation.” The essence of government budgeting brinkmanship is not to cut project 13 when you only have money for 12 projects, but to cut project #1.

I can just see me going to Chuck Knight at Emerson Electric and saying “Chuck, I don’t have enough money. If you don’t give me more, we are going to have to cut the funds for the government-mandated frequency modification on our transmitters, which means we won’t have any product to sell next month.” I would be out on my ass in five minutes. It just floors me that this seems to keep working in the government. Part of it is that the media is just so credulous when it comes to this kind of thing, in part because scare stories of cut services fit so well into their business model.

Matt Welch has a great 8-point takedown of similar scare story on the current California budget crisis. You should definitely read it, but I wanted to add a #9 — this idea that the core, rather than the marginal, expense is always the first to be cut. From the LA Times:

Gov. Arnold Schwarzenegger has proposed slashing state spending on education by $3 billion to help close the budget gap, and the state would pay dearly for canceling classes, firing instructors, cutting class days and shortening the school year, experts said.

Promising students would go to other states, taking their future skills, earnings and, possibly, Nobel Prizes elsewhere. California companies would then find it harder to attract high-value employees who might be dubious about moving to a state with sub-par schools. [...]

John Sedgwick, co-founder of Santa Clara solar-energy company Solaicx, agreed.

“When you think about the genesis of Silicon Valley, it really started from its superior educational base” at Stanford and UC Berkeley, said Sedgwick, whose company makes the building blocks for photovoltaic cells. “That indicates that you don’t want to kill the goose that’s laying the golden eggs.” [...]

The only way the most “promising” students would be affected is if, when the schools cut back, the best professors (rather than the worst) are fired and the most promising students (rather than the most marginal) are denied admission for limited spots. Really? If Berkeley has 10 fewer spots, it’s going to start cutting admissions with the Physics wiz kid who had a 2400 on her SAT?

Further, is it really true that California only attracts people to its work force who went to school in California? A top Michigan or Harvard grad won’t do just as well? I went to college in New Jersey yet have never held a job in that state.

Now, I understand that part of the argument is that workers may not come if the local primary schools for their kids are bad. And that is true. But California has had poor performing schools despite years of high and increasing spending. Matt has much more on this in his piece.

Postscript: Of course, as crazy as it seems, there may be some reality to this threat. I could easily see the University of California system, when faced with the choice of cutting back on some post-modernist social science program or a physics program that has produced 7 Nobel Laureates, choosing the latter to cut in a fit of outrageous political correctness.

At the primary level, it is very possible that the bloated school administrations filled with rafts of useless assistant principals will choose to fire teachers rather than themselves. So unfortunately the plans to cut the most useful spending in a crisis and keep the most useless is not just a threat, it is a reality.

Layoffs for May 2009 at America's 500 largest public companies

2009-06-14T19:03:00.000-07:00

May 30: Deere & Co ( DE - news - people ) lays off 89 in North Dakota and 16 in Louisiana as part of ongoing reductions.
Article Controls

May 29: Cintas ( CTAS - news - people ) projects worse than expected fourth-quarter results and lays off 650 workers.

May 22: Monsanto ( MON - news - people ) lays off 55 in Mississippi as part of manufacturing facilities consolidation.

May 21: UPS's ( UPS - news - people ) airlines arm cuts 80 mechanics on slump in shipping volume.

May 19: Hewlett-Packard ( HPQ - news - people ) announces 17% decline in quarterly profit and reduces workforce by 2% (6,400 workers).

May 19: Medtronic ( MDT - news - people ) cuts executive pay by 5%, freezes salaries and slashes upwards of 1,800 jobs.

May 18: American Express ( AXP - news - people ) reduces global workforce by 6% (4,000 jobs) adding to a 7,000-employee cut announced last October.

May 15: Following review of operations announced in February, Nike ( NKE - news - people ) cuts 1,750 jobs (5% of total workforce).

May 15: Fruit of the Loom--a Berkshire Hathaway ( BRK.A - news - people ) subsidiary--pink-slips 80 in Alabama.

May 12: Applied Materials ( AMAT - news - people ) posts quarterly loss and increases previously announced job cuts by 300.

May 11: Dell ( DELL - news - people ) slashes 260 jobs in North Carolina and blames the economy.

May 7: Cummins ( CMI - news - people ) idles Indiana plant that supplies Chrysler and lays off 610 workers.

May 7: DuPont ( DD - news - people ) adds to December job cut of 2,500 with another 2,000-employee cut.

May 6: Wells Fargo ( WFC - news - people ) freezes pension plans and fires 548 in North Carolina.

May 5: Microsoft ( MSFT - news - people ) pink-slips a second 5,000 employees following its initial January layoff.

May 5: Allstate ( ALL - news - people ) closes claims office in Florida and lays off 66 employees.

Satyam may 2009 lay off 5,000

2009-06-14T19:01:00.000-07:00

Board meeting of Satyam Computer to discuss business strategies, is expected to take place on June 11 after the new owner, Tech Mahindra, assumed charge and one of the main agenda’s would be the company’s workforce. There are indications that the company might agree to lay off about 5,000 staffers in phases.

The meeting, scheduled to be held on next Thursday or Friday for the first time in the presence of it’s new board — six government-nominated members and four member from Tech Mahindra, is expected to discuss the company’s business strategies.

Vineet Nayar, the Tech Mahindra CEO, had said recently that Satyam has about 10,000 surplus staff and that the company would come up with the ‘least painful’ ways to handle this situation. Given the sensitivities of the situation, it is highly assumed that the board is likely to draw a consensus on the ‘lay offs’ which might be shaped up in forming about 5,000-10,000 people as the reserve/bench strength.

Reducing Staff in a Down Economy: Handling Terminations and Using Separation Agreements

2009-05-17T03:14:00.000-07:00

Staff reductions and terminations have been an unfortunate result of the current economic downturn. So far this year, U.S. employers, seeking to cut costs, have eliminated more than a quarter million jobs. In addition to employees laid off due to economic considerations, underperforming employees and those that violate Company policies are less likely to be retained in tough financial times when the Company’s bottom-line is under scrutiny by corporate officers, boards of directors, and shareholders. However, employers must keep in mind that terminations cause more lawsuits than any other employment action, and anticipated cost savings can be negated by legal defense costs.

Despite the general rule that the employment relationship is “at-will” and can be terminated at any time, with or without notice, reason or cause, there are many exceptions to the at-will rule, making each termination open to potential legal challenge. Moreover, when the job market is difficult and terminated employees have a hard time finding work, they are more likely to pursue litigation against their former employer. In our practice, we are witnessing first-hand both the increase in terminations and the corresponding increase in lawsuits by terminated employees. This edition of the Employment Law Advisor focuses on handling terminations, using separation agreements, and the steps employers can take to reduce the risk of legal claims and liability in this challenging economic environment.
Terminations: The Legal Landscape

There are three categories of restrictions on employers’ ability to discharge employees: statutory, contractual and common law. Each restriction is a source of potential liability for employers. Statutory restrictions are those imposed by federal, state and local laws, such as laws prohibiting employment discrimination and retaliation. For example, it is unlawful under federal law to make a termination decision based upon an employee’s age, race, national origin, sex, religion or disability. In addition, Massachusetts also prohibits termination decisions based upon sexual orientation, ancestry, genetics or military service. Unlawful retaliation includes discharging an employee because the employee (i) participated in an activity protected by an employment statute (e.g., filing a complaint, testifying, assisting or participating in an investigation, proceeding or hearing) or (ii) opposed an employment practice prohibited by the statute (e.g., objecting to discriminatory hiring practices).

Contractual restrictions are those agreed to (or self-imposed) by the employer, including restrictions contained in employment agreements (e.g., employment for a one-year term). Contractual restrictions may also arise from statements made in offer letters or through other written or oral promises of continued employment for a specified period of time or unless discharged for “cause.” In some instances, an employee handbook or particular personnel policies may create explicit or implicit restrictions on the employer’s right to discharge employees “at-will.”

Common law restrictions are those created by the courts to protect employees from some types of employer conduct not prohibited by statutes. Such restrictions include prohibitions on discharges that violate “public policy,” such as firing an employee for refusing to engage in unlawful behavior on behalf of the employer. Massachusetts courts also hold that there exists in every at-will employment relationship a “covenant of good faith and fair dealing” that is violated when an employer discharges an employee in bad faith in order to avoid payment to the employee of earned compensation. There are also other common law claims that can arise from the manner in which a discharge is handled, including claims of defamation, false imprisonment and intentional or negligent infliction of emotional distress.
Steps Employers Can Take to Reduce the Risk of Claims and, Liability Due to Terminations

Employers should recognize that an employee termination may some day be judged by a third party (e.g., a jury) who may base its decision on the perceived “fairness” of the employer’s actions. Although legal challenges are sometimes unavoidable, there are steps employers can take to reduce their risks and to ensure that the termination process itself does not lead to additional employee claims.

1. Determine/clarify the precise reason(s) why the employee is being discharged. When a termination decision is challenged as discriminatory or retaliatory the claim usually turns on the employee’s ability to show that the reason given by the employer is untrue. When an employer says one thing at the time of termination (sometimes to spare the employee’s feelings) and something else later to the court or investigating agency, the employer’s ability to defend the case may be severely impaired.

2. If discharging for misconduct, be certain that there was a thorough and objective investigation of the employee’s conduct. Was the employee given an opportunity to explain his or her side of the story? Have any admissions by the employee been documented? If discharging for poor performance, determine whether the performance problem is well-documented and demonstrable.

3. Avoid surprise. Determine whether the employee was given prior notice that his or her misconduct or continuing poor performance would result in discharge. While not legally required, notice generally is expected by courts and investigating agencies, and the failure to provide notice is viewed with great suspicion (except in those situations involving egregious employee misconduct).

4. Consider the appearance of unfairness, given the potential that the employer’s actions will be judged by a third party. Is discharge clearly warranted for the employee’s misconduct or poor performance? Are there any mitigating circumstances? How have other employees been treated in similar situations? These considerations are of particular importance when a potential discrimination or retaliation claim exists.

5. Review the employee’s personnel records and any documentation relating to the discharge: (i) to get an accurate picture of his or her work record; (ii) to make certain the documentation is complete; and (iii) to remove any materials that do not belong in the file.

6. Review any employment agreements, offer letters, and pertinent personnel policies to determine whether the employer has complied with all requirements, including any notice prerequisites.

7. Assess whether there is any particular vulnerability to legal challenge. Is the employee a member of a protected group (e.g., age 40 or older)? Has he or she exercised a legally protected right recently (e.g., taken Family and Medical Act leave, requested reasonable accommodation of a disability, filed a complaint of discrimination or harassment)? Are there any contractual restrictions to discharge? Are any public policy issues involved (e.g., the employee objected to doing something because of legal or ethical concerns)? Will the employer arguably be in any way unjustly enriched by the discharge (e.g., the employee loses a bonus or commission due to the timing of the discharge)?

8. Plan the termination meeting carefully, taking into consideration the dynamics of the situation. Who will be present? (More than one employer representative should attend.) Where and when will it be conducted? Be discreet. Avoid a “termination march” past co-workers. Avoid causing unnecessary embarrassment or emotional distress to the employee.

9. Be truthful and accurate in telling the employee the reason(s) for the discharge, in a direct but respectful manner. Present the decision as definite and final (assuming it is). Offer support, but not in terms of reversing the discharge decision. Be knowledgeable and prepared to discuss the employee’s termination benefits, including any severance pay, any accrued vacation pay, group insurance continuation, the form of reference the employee will receive, and the employer’s position on unemployment benefits. Also be prepared to discuss any transition matters and any continuing employee obligations (e.g., non-disclosure and/or non-competition restrictions). Prepare a memorandum documenting what was said in the meeting.

10. Provide the employee with a final paycheck. The Massachusetts Payment of Wages Act, M.G.L. c.149, §148, requires that discharged employees be paid their full and final wages on the date of discharge, and the Act provides substantial remedies to employees for violations. Final wages include pay for all accrued and unused vacation time as well as commissions or potentially bonuses earned but not yet paid. Employers should not make any irregular deductions (e.g., for equipment not returned, property damage or outstanding loans) without careful consideration of the potential legal ramifications.

11. Provide notice of the employee’s (and other beneficiaries’) rights regarding health insurance continuation under federal law (COBRA) or state law.

12. Massachusetts law requires that employers provide terminated employees with a notice from the Division of Unemployment Assistance (“DUA”) concerning how to file for unemployment benefits. Download: DUA’s notification pamphlet.

13. Take all appropriate security measures to protect co-workers (if there are safety concerns) and to protect the employer’s business interests (e.g., obtain employee’s laptop, cell phone, keys, pass cards, employer credit cards, terminate access to computer system, prevent the removal of confidential documents and materials).

14. Take appropriate steps to keep confidential matters surrounding the discharge (including any investigation leading up to it). Generally, when the discharge is for misconduct, a strict “need-to-know” rule should be followed to reduce the risk of a defamation claim.

15. As discussed below, in appropriate circumstances, consider presenting the employee with the option of receiving additional termination benefits in exchange for a legal release of all claims the employee may have against the employer.

Our experience in defending hundreds of claims by discharged employees tells us that what is said at the time of termination, and how the termination process is handled by the employer, often determines whether an employee will subsequently file a legal claim. When an employee does file a claim, an employer’s contradictory statements, insensitive conduct or other missteps at the time of termination almost always adversely impact the employer’s defense of the claim and increase its exposure to damages. We believe that taking the steps outlined above will help employers manage employee terminations more effectively and avoid the mistakes that so often lead to employee claims.
Using Separation Agreements to End the Employment Relationship

For many employers, an employee termination triggers an almost knee jerk reaction: offer the employee severance pay and a separation agreement with a release of claims to avoid a potential employee lawsuit. Although there are advantages to the use of separation agreements to prevent prospective legal headaches, such agreements may not be appropriate in all instances. Moreover, a form of separation agreement is often used with little thought regarding whether it is suitable under the circumstances or has been updated. In light of recent legal trends, that form could be found unenforceable by a court, which could result in the former employee getting to keep the severance pay but also having the right to sue the company for employment claims.
Is a Separation Agreement Appropriate?

Whether to offer a terminated employee a severance package in return for a release of claims depends on a number of employer specific factors, such as employer policy, practice and employee relations philosophy. Generally, providing severance in exchange for a release can be a worthwhile investment, as the amount of severance is often insignificant when compared to the cost of defending an employee claim. Severance agreements are particularly useful when the termination is a difficult one or the separated employee is viewed as the type of person likely to assert a claim. Severance agreements are also effective tools to prevent litigation in the context of layoffs, where there are risks of multiple claims.

However, there are sometimes factors that militate against offering severance. For example, out of fear of litigation many employers offer severance to nearly all employees, regardless of the reason for termination, needlessly driving up the overall costs of employee terminations. Offering severance to an employee fired “for cause” may send the wrong message to other employees, i.e., that they will get severance no matter what the infraction.

Further, offering an employee a severance agreement, which by necessity will contain at least some “legalese,” may unintentionally generate claims. When provided with an imposing legal document, a terminated employee may feel compelled to consult an attorney (indeed, the severance agreement may advise the employee to do so). Especially if the severance offered is relatively modest, the offer may do no more than cause the employee to consult counsel and consider asserting claims when he or she might otherwise not have done so.
Special Issues Relating the Older Workers’ Benefit Protection Act

Employers should ensure that any release of age claims under the federal Age Discrimination in Employment Act (“ADEA”) complies with the Older Workers’ Benefit Protection Act (“OWBPA”). A compliant agreement must include the following provisions (among others): (i) a 21 day consideration period; (ii) a 7 day revocation period; and (iii) advice to consult with an attorney prior to executing the agreement. Omitting these and other provisions will mean that the release will not waive age claims under federal law. Moreover, employers should be aware that in situations involving the termination of two or more employees special rules apply to release federal age claims, including additional time for consideration (45 days) and detailed informational disclosures.
Special Issues Relating to Reductions In Force

Reductions in force (“RIFs”), which often involve the termination of substantial numbers of employees, must be planned carefully given the potential cost of defending potential claims from large numbers of employees or a class-action lawsuit. Moreover, employers conducting RIFs must consider the potential impact of laws concerning plant closings, such as the federal Workers Adjustment and Retraining Notification Act (“WARN”) and Massachusetts plant closing law.

Generally, WARN requires employers with 100 or more employees to provide 60 days’ notice prior to a plant closing or before laying off/terminating 50 or more employees. Compliance with WARN can be technical and missteps may subject an employer to substantial penalties, so counsel should be consulted well in advance of any planned RIF. Massachusetts also has a plant closing law that applies to any employer closing a facility that had 50 or more employees during the previous six-month period. Under state law, a “plant closing” is defined as a permanent cessation or reduction of business at a facility that results in the permanent separation of at least 90% of the employees within a 6 month period. Among other things, the law requires reporting to state agencies. If both WARN and Massachusetts law are triggered by the RIF, the employer must comply with both.

Additionally, if a reduction in force is challenged in court, the employer will want to have its selection and decision-making process well-documented so that it can show that layoff decisions were based on legitimate, non-discriminatory considerations. Employers should also consult with counsel to discuss conducting an analysis of the impact of the RIF on protected categories (i.e., age, race, sex, etc.) prior to implementing the layoff.
Conclusion

Handling terminations carefully is always important, but is even more so in an economic downturn due to the increased risk of former employees bringing legal claims. Each situation should be reviewed carefully to ensure that the risk of claims and the potential exposure to liability is minimized. Steps may need to be taken before the termination or layoff is implemented.

Whether it makes sense to offer a terminated employee a severance package in return for a release of claims depends on a number of employer specific factors, such as employer policy, practice and employee relations philosophy. Providing severance in exchange for a release can be a worthwhile investment, as the amount of severance is often insignificant compared to the cost of defending an employee claim. Severance agreements also can be effective tools to prevent litigation in the context of layoffs, where there are risks of multiple claims. Employers should revisit their separation agreements to ensure the agreements will be enforced. Employers should also make sure they are in compliance with the special requirements relating to reductions in force and plant closings.

Reducing Layoffs as Economic Stimulus

2009-05-17T03:09:00.000-07:00

President-Elect Obama has proposed that $10 billion of his economic stimulus package be dedicated to expanding and extending Unemployment Insurance to help people who have lost their jobs. Given the fact that the unemployment rate increased from 4.9% to 7.2% last year, this appears to be a good idea. However, I have a suggestion for him - redirect some of those funds to encourage companies not to layoff their employees in the first place! As we all know, companies are laying off employees in alarming numbers to cope with the recession. Aside from the terrible impact layoffs have on those directly affected, they also have insiduous effects on the company and society as a whole:

1) Low morale and reduced productivity - The employees that survive layoffs are typically traumatized by the experience and are constantly watching over their shoulders to make sure they don't go next. A culture of worry permeates the environment and workers spend significant amounts of time discussing the layoffs, what happened to their colleagues who were let go and what the future holds. Consequently, although everyone keeps up the appearance of being busy, productivity takes a big hit. Given the fact that we have a knowledge economy, the impact of the reduced productivity of employees cannot be overstated.

2) Increase in consumer fear - Every time another corporate layoff and the increasing unemployment rate becomes public news, consumers become even more afraid that their company may be next even if their company has announced no such plans. This fear contracts consumer spending even further thereby making the economic crisis worse, thereby increasing the number of companies that feel pressured to layoff employees.

This vicious cycle will continue to perpertuate itself unless companies are given an incentive not to layoff their employees. A few ideas include:

a) Tax breaks for companies who don't take part in layoffs

b) Tax incentives for companies to utilize Flexible Working Arrangements to reduce payroll costs

c) Tax breaks for employees who agree to a reduction in their salaries and benefits
Do you have any other ideas as to how to reduce the layoffs epidemic? Do you know any company being creative about managing payroll costs? I would love to hear from you.

Employers can reduce labor costs without layoffs

2009-05-17T03:08:00.000-07:00

n this economic climate, many companies are laying off employees to cut costs and stay open. However, there is an alternative to layoff in the form of a mandatory furlough. A furlough occurs when a company either shuts down for a specific number of days, say one week per month, or reduces its employees' workdays, say from five to four. In either situation, the employees' time off is without pay. This is a viable method for an employer to reduce costs without losing its already trained employees; however, it may affect an employee's exempt status and, consequently, his or her overtime exemption under the Fair Labor Standards Act.

Under the FLSA, exempt employees must be paid the same minimum salary for each week that they perform any work. If the pay cut created by a furlough takes an exempt employee's salary below the minimum required by the FLSA, the employee's exempt status is threatened. The FLSA also prohibits an employer from deducting money from an exempt employee's paycheck during a current pay period based on a reduction in work time. Further, under California law, reducing an exempt employee's schedule in combination with a salary deduction will defeat the overtime exemption.

To maintain an employee's exempt status and implement a furlough, the employer may, of course, simply reduce the employee's salary without reducing the hours worked. Another option is to implement the furlough on the basis of a full week that coordinates with the workweek. Under this system, the employee's exempt status would not be jeopardized because the employee is not entitled to a salary for any week in which he or she performs no work.

If a mandatory furlough is in the offing, the employer must make sure that all affected employees are given advance written notice. We recommend that the notice set forth the changed hours of work as well as the obligations of the employee during the furlough. This would include, for example, whether the use of accrued PTO or vacation time is elective or mandatory and, in the case of exempt employees, notice that absolutely no work may be performed on behalf of the employer during the furlough even insignificant work in the form of e-mail, telephone or other methods of communication.

How to reduce Startup expenses…But NO layoffs please

2009-05-17T03:05:00.000-07:00

We’ve earlier reported startups/companies layoff news here and here but as such layoffs have become so frequent now that it’s no more a news but just an obvious reaction to the troubled economy.

As of now, more than 20,000 employees working at tech star

tups/companies have lost their job and this figure may exceed one’s wildest expectations in the coming months.

Seeing the current situation, we decided to put forward a bunch of tips for startup guys & entrepreneurs to avoid “painful layoffs” and still survive this crunch period…

Have a look at this eleven tips !

1. Re-direct surplus/additional human resource

Although startups do not, in general keep surplus staff (for the sake of handling unplanned & overwhelming business opportunities),but if there’s anybody doing nothing relevant to your startup then better give him a break.

Mind you, layoffs are painful only to those who were working hard but still became a victim of situation but those who were good for nothing(such folks themselves know that better) won’t take it as a big blow. You may re-direct those guys to some neighboring startup requiring few part-time folks. Hence this makes such a layoff a bit ‘painless’. The rest 9 tips do not involve layoffs at all.

2. Follow Barter economy

Trade your services rather than just selling them. You may be good at technology but spending big bucks on editorial side at your startup and there may be a startup who’ve some under-utilized editors but have lack of tech support. Hence, trading/exchanging services can help you out in saving from critical expenses. You may try Craigslist for finding such service-trading partners.

3. If possible, have a fund-raise but assuming ‘it’ to be the ‘last chance’

If VCs/Angels are still hopeful enough to help you have a fund-raise, go for it. It better to ‘Survive’ with less authority than to ‘Get exhausted’ with more authority(such authority of no use then !). But assume that no more funds will come your way if you don’t show optimistic response to your investors this time.Remember, a dollar saved is a dollar earned.

4. Turn “full time employees” into ‘Work at home’ or ‘Contract based’

To save out your office space and cutting running costs,this method can prove one of the best ways to avoid layoff. Folks remain connected(you can call them back when things go fine) and still you save crucial bucks as they aren’t full time.

5. Cut out Travel & Marketing expenses

We are talking about survival at this time…not about viral promotion of your service.So, marketing/touring expenses can take a backseat in such a situation

6. Reduce your own salary

Top guys(CEO,CTO,who’re usually the co-founders of a startup) are the ones who are least probable to ditch their own startup in crunch situation.Also, their salary is supposed to be highest as well.A 15-20% reduction in their salary can help saving one or two layoffs.

7.Don’t cut out on folk’s salaries

Offer them work higher than usual(say 2-3 hrs more) for the same salary/perks. As time is money so you get to save time(or money) this way. They would like to work a bit longer rather than going down on their current expenses/lifestyle.

8. Monetize more…

If your startup’s business model is largely based on advertising revenues and that means,you have been maintaining a trade-off between money-visitors then try to monetize higher than usual.

Even a re-organisation of your ad placement may save you a folk’s salary(if you’re bringing respectable viewership).Mind you, ‘one folk saved’ is ‘one folk added’.

9. Evaluate options for unavoidable expenses

You may realise that shifting from ‘fixed cost servers’ to ‘Cloud computing based servers’(such as Amazon EC2) may save you one-third a folk’s salary.Look at VOIP.Its quality has increased significantly and it’s cost-effective as well.Similar options on other unavoidable expenses may save you few hundred dollars every month.

10. Fire your PR folks….they just can’t help you out at this moment

They may be good when you’ve plenty to spend but right now, they are just not required. So, get rid of them if you haven’t already done it.

11. Rent out your office space to some other startup or work on Shared basis

Renting additional office space or sharing office infrastructure can serve as a good idea to save up some money

Job cuts hit 6-month low in April, Illinois mass layoffs also decline

2009-05-16T11:33:00.000-07:00

Job-cut announcements by U.S. employers dropped for the third consecutive month in April, falling to the lowest level in six months, according to Chicago outplacement firm Challenger, Gray & Christmas. But the cuts were 47 percent above April 2008.

Layoff tallies also declined in reports submitted to Illinois state government. In April, 12 companies advised the state of plans to eliminate an aggregate 1,532 jobs.

That compares with 22 companies in March that filed notices to cut 2,486 jobs. In April 2008, 12 companies planned to slice 2,849 jobs, according to the Illinois layoff notices. The 60-day advance notices are required of most employers with 75 or more workers.

Job cuts remain at recession levels, but their decline could signal that employers are more confident about business conditions, said John Challenger, chief executive officer of the outplacement firm. "It does look as though we may be past the worst of it," Challenger said.

Glass half empty? Labor Department: Layoffs slow to 539K in April

2009-05-16T10:58:00.000-07:00

The pace of layoffs slowed in April when employers cut 539,000 jobs, the fewest in six months. But the unemployment rate climbed to 8.9 percent, the highest since late 1983, as many businesses remain wary of hiring given all the economic uncertainties.

The Labor Department tally released Friday wasn't nearly as deep as the 620,000 job cuts that economists were expecting, and was helped by a burst of government hiring. The rise in the unemployment rate from 8.5 percent in March matched economists' forecasts.

The new report underscored the toll the longest recession since World War II has taken on America's workers and companies. However, the slowdown in layoffs may bolster hopes that the worst of the downturn's hefty job losses are past.

Still, companies will remain cautious in hiring, making it harder for laid-off workers to find new jobs.

If laid-off workers who have given up looking for new jobs or have settled for part-time work are included, the unemployment rate would have been 15.8 percent in April, the highest on records dating back to 1994. The total number of unemployed now stands at 13.7 million, up from 13.2 million in March.

Companies also kept a tight rein on workers hours. The average work week in April stayed at 33.2 hours, matching the record low set in March.

Since the recession began in December 2007, the economy has lost a net total of 5.7 million jobs.

As the recession eats into sales and profits, companies have turned to layoffs and other cost-cutting measures to survive the storm. Those including holding down workers' hours, and freezing or cutting pay.

Job losses in February and March turned out to be deeper, according to revised figures. Employers cut 681,000 positions in February, 30,000 more than previously reported. They cut 699,000 jobs in March, more than the 663,000 first reported.

The deepest job cuts of the recession — 741,000 came in January. That was the most since the fall of 1949.

Employers last month cut the fewest jobs since 380,000 in October. Nonetheless, the April job losses were widespread.

Construction companies axed 110,000 jobs, down from 135,000 in March. Factories got rid of 149,000 jobs, down form 167,000 the month before. Retailers cut payrolls by nearly 47,000, less than the nearly 64,000 cut in March. And job losses in financial activities dropped by 40,000, down from 43,000 in the previous month.

The slower pace of job losses — along with 72,000 more government jobs — helped to temper the overall payroll reductions in April.

March Mayhem Tally Tops 3,500 After End-of-Month Law Firm Layoffs

2009-05-16T10:55:00.001-07:00

Although major law firm layoffs have seemingly slowed down from the blistering pace set during the first 10 days of March, the end-of-month total is still a stunning figure.

Some 3,500 attorneys and staff, and perhaps significantly more, have lost their jobs, and announcements of canceled summer programs, postponed first-year associate start dates and even pay cuts at all levels up to and including partners have lost their initial power to shock. The 3,500 figure for March compares to considerably lower tallies of roughly 2,000 law firm jobs eliminated in February, and 1,500 in January.

After last week's round up, another seven law firms have added well over over 300 layoffs to the total for March: Fried Frank Harris Shriver & Jacobson (41 associates and 58 staff); Gibson Dunn & Crutcher (36 staff); Locke Lord Bissell & Liddell (the firm confirms layoffs of attorneys, counsel and staff, but won't provide totals; Above the Law says about 6 percent of associates are being cut, and the Austin Business Journal reports that same figure); Reed Smith (26 attorneys and 74 staff); Robinson & Cole (11 attorneys and 19 staff); Skadden Arps Slate Meagher & Flom (25 staff layoffs were confirmed, but from what the firm says it appears that a much larger number of staff lawyers and staff may have been laid off); and Stroock & Stroock & Lavan (10 percent of associates).

Because some law firms haven't announced layoffs or haven't provided the number of employees let go, the actual tally of confirmed layoffs for March clearly tops 3,500, although the exact number isn't certain. Lord Locke and Stroock, for example, aren't included in the 3,500 total because they haven't provided layoff numbers, although they have confirmed layoffs, and Skadden apparently may have laid off a much larger group than the 25 staff members confirmed and hence included.

March 2009 Layoff List

2009-05-16T10:53:00.000-07:00

Mar. 31: Cardinal Health ( CAH - news - people ) pink-slips 800 workers as part of cost cutting efforts.

Mar. 31: Deere & Co. ( D - news - people ) places 40 Illinois employees on indefinite layoff.

Mar. 30: KLA-Tencor ( KLAC - news - people ) lays off 10% of its workforce which comes to roughly 500 employees.

March 27: Wal-Mart Stores ( WMT - news - people ) closes Ohio facility and lays off 650 workers.

March 26: Agilent Technologies ( A - news - people ) freezes share-buyback program and cuts 2,700 jobs.

March 26: Google ( GOOG - news - people ) institutes second round of layoffs by pink-slipping 200 workers.

March 25: Shaw Industries--a Berkshire Hathaway ( BRK - news - people ) subsidiary--closes two plants, idling 600 workers.

March 25: Constellation Brands ( STZ - news - people ) reduces workforce by 5% (400 workers) following decline in wine sales.

March 25: IBM ( IBM - news - people ) slashes workforce in U.S. by more than 4%, or roughly 5,000 workers.

March 24: Legg Mason ( LM - news - people ) lays off 120 to adjust to its current business needs.

March 24: Synovus Financial ( SNV - news - people ) dismisses 200 employees following a 650-worker layoff in September.

March 24: Cummins ( CMI - news - people ) fires 127 workers when voluntary layoff fails to entice enough to leave.

March 22: Freeport-McMoRan ( FCX - news - people ) pink-slips 50 employees at Denver mine.

March 19: Lam Research ( LRCX - news - people ) pink-slips 375 or 10% of the company’s workforce.

March 17: Caterpillar ( CAT - news - people ) adds another 2,454 layoffs to a growing total, as construction equipment demand continues to be weak.

March 17: A Corning ( GLW - news - people ) subsidiary cuts 200 jobs at North Carolina plant.

March 17: Weyerhaeuser ( WY - news - people ) continues ongoing layoffs and production cuts by closing two lumber mills and firing 307 workers.

March 16: TRW Automotive Holdings ( TRW - news - people ) continues ongoing cuts with 42 salaried employees in Wisconsin and Minnesota.

March 13: Baker Hughes ( BHI - news - people ) pink-slips 1,500 (about 4% of workforce)--this follows a layoff of the same number back in January.

March 13: PPG Industries ( PPG - news - people ) lowers first-quarter expectations and lays off 2,500.

March 13: Sunoco ( SUN - news - people ) fires 750 salaried workers--about a fifth of its workforce.

March 12: Weyerhaeuser ( WY - news - people ) cuts 59 workers at a mill in Oregon.

March 11: AMR ( AMR - news - people ) dismisses 323 flight attendants in response to travel slump.

March 10: Lowe's ( LOW - news - people ) closes lighting and ceiling fan distribution center; fires 82.

March 10: Principal Financial Group ( PFG - news - people ) cuts 60 jobs in its health arm (20 at headquarters).

March 10: Suffering from plummet in building and aerospace sectors, United Technologies ( UTX - news - people ) reduces workforce by 5% (11,600 jobs globally).

March 6: Deere & Co. ( DE - news - people ) fires 325 employees at plants in Iowa on weak construction equipment demand.

March 4: Northrop Grumman ( NOC - news - people ) targets administrative positions in California with 750-worker layoff.

March 4: Heil--a subsidiary of Dover ( DOV - news - people ) that makes waste and recycling trucks--cuts 180 jobs.

March 4: General Dynamics ( GD - news - people ) pink-slips 1,200 as turbulence in the aerospace sector continues.

March 3: U.S. Steel ( X - news - people ) closes two plants in Ontario, affecting 1,500 jobs and sparking frustration in Canadians over "U.S. protectionism."

March 3: FirstEnergy ( FE - news - people ) reduces non-union staff by 4% (335 workers) to reduce costs.

Law Firms Layoff List - April 2009

2009-05-02T07:08:00.000-07:00

Here is a smaller list for the month of April. Below are the confirmed layoffs for April. Obviously there are a lot more firms getting rid of staff, but unless I can confirm numbers, only the companies that have published will be displayed. (This is a work in progress post).

Perkins Coie Cuts 12 Associates, 26 Staffers, April 14, 2009
Baker & McKenzie Eliminates 124 Legal and Non-Legal, April 7, 2009
Hogan & Hartson let go 93 Staffers, April 2, 2009
Mayer Brown Cuts 135 Lawyers, Staff Across US, April 2, 2009

Job losses due to world crisis tapering off

2009-05-02T07:05:00.000-07:00

MANILA, Philippines—Economic Planning Secretary Ralph Recto has announced that job losses resulting from the global financial crisis were “tapering off.”

In his report at the Cabinet meeting Tuesday morning, he said the business process outsourcing (BPO) sector alone was expected to generate around 500,000 jobs in Mindanao, particularly in South Cotobato, Sultan Kudarat, Sarangai and General Santos City.

“Business process outsourcing is robust and the non-voice services will complement the job generators in the call centers,” Cabinet Secretary Silvestre Bello III quoted Recto as saying in a media briefing.

Bello said the 14,000 workers displaced months ago had been rehired by their respective companies.

He said the second phase of the North Luzon Expressway (NLEx) project for C-5 would also create 100,000 jobs.

So far, he said 75,000 workers had benefited from the government’s Comprehensive Livelihood and Emergency Employment Program.

Sega to lay off 560 employees

2009-04-04T02:55:00.000-07:00

The latest bad financial news from the gaming industry comes from Sega. The Japan-based publisher just announced its latest numbers and the results are not good. In fact they are bad enough that the company has announced plans to lay off 560 of its worldwide employees (Sega has about 3,100 employees). The company will record a loss of over $235 million, according to Kotaku.

A few weeks ago, it was reported that Sega's US branch had laid off 30 of its employees (A spokesperson later confirmed there were layoffs but would not confirm specific numbers). The new press release states that in order to save costs, Sega will cut 20 percent off its research and development budget which likely means a number of upcoming games could be canceled.

Life After a Layoff

2009-04-04T02:53:00.000-07:00

Reggie Case* doesn't need a regular paycheck to make him feel secure. He's already decided he can survive this recession. But a stable income and benefits were nice while they lasted.Reggie, 42, husband, father of two, and a lifelong construction worker with only a high-school degree, left the comforts of a company job behind in May 2008. Reggie saw his layoff coming. In fact, he even helped his boss decide it was time to let him go. For 16 years Reggie was at the center of a small construction and manufacturing company in a suburb of Cleveland. He managed every aspect of it - from leading construction projects to managing commercial property spaces. "I was deep in the business. I knew all their clients, bankers, everyone," he explains. So it was easy for him to see a shift was underway. "I knew a year in advance," he notes. "It wasn't discussed. But anyone smart enough could see that the business they were getting was getting smaller." He responded at the first sign of trouble. "I always have had something on the side. So I would take on more side work. I was preparing for a transition," he says. When spring 2008 arrived and no big summer construction gigs were on the docket, Reggie gave himself and his close friends, the owners, a chance to make a smart decision."I brought them into my office and said, 'How long are we going to pretend I have something to do?'" he explains. While they were surprised by his honesty, the owners admitted they had fretted for months over when and how to let him go. Reggie departed soon after their candid conversation.

Reggie's side work quickly turned into a business of its own. There are pros and cons, he says, of going solo."Business is tough, but it's there," Reggie says. "A lot of getting a job is just about showing up." Regarding the state of the construction industry, he says, "Big business will not be there, like it was, because no one is spending on big construction." He's developed an optimistic response to losing his seat on the gravy train. "I call myself the 'King of the Bottom Feeders.' The only way to make money is to be out there, using word of mouth and taking the little [jobs]," he says. Reggie will take nearly any job -- any time, any size. He makes money from the small projects most construction managers won't consider.But all this hustle carries a cost. Besides not knowing where the next check is coming from, making himself constantly available requires stamina. "Instead of getting home at 5 p.m. and turning the phone off, it's on all evening. And if you need to look at a job on a weekend or evening, you fit it in. You get it done," Reggie says. Why not get a new gig with a different company? Reggie is hooked on his new favorite perks: more family time and the freedom to set his own schedule."I love that I can be with my family more," he says. "Time with your family? That's time you can't get back. Having that handed to me at such a young age is getting a raise."Plus, his day is his own. "I decide where I go and what I can do. I don't have the guilt of the bosses or the company when something else comes up during the day," he says.His family, meanwhile, has been very supportive. Reggie says, "My wife? To say she's been great would be an understatement. She's always felt I was someone who needed to be on his own. There was a relief for her, I think."Reflecting on his bold decision to approach his former employer about laying him off, he says, "I wasn't giving up anything, because there wasn't going to be anything there next May."When asked if he was angry about losing his job, Reggie quickly responds, "That's business. You do that sort of thing in business." While he admits the situation initially irked him, he's moved on. In fact, he ended things so well at his old company, his former bosses now send him business.Reggie offers this advice to all who have recently lost their jobs: "They have to realize that the money that they made and the job that they had is going to be dramatically different for the rest of their lives. You're going to have to get creative to make money. This isn't going to change soon, either."*The source's name has been changed for privacy purposes.

Layoff Tracker

2009-04-03T09:54:00.000-07:00

March's tally of job cuts -- 663,000 -- was slightly higher than expected, as the total number of out-of-workers (13.2 million) brought the unemployment rate to 8.5 percent, a level not seen since 1983. That figure has climbed 1.8 percent since November, and 3.6 points since analysts say the recession began in December 2007. As has been the case in recent months, layoffs have affected just about every industry -- only healthcare and education managed to add workers in March. In all, the recessional economy has lost 5.1 million jobs, thanks in part to a restatement (upwards, of course) of January's totals to 741,000.

In Taiwan, unpaid leave instead of layoffs carries its own cost

2009-04-03T09:42:00.000-07:00

Reporting from Hsinchu, Taiwan -- As California and the rest of the nation stagger from massive layoffs and soaring unemployment, companies in Taiwan have largely opted to cut pay and work hours to deal with the economic crisis.

Here in Hsinchu Science Park, modeled after California's Silicon Valley, about 100,000 of its 130,000 workers are taking up to 10 days of unpaid leave a month.

Part of the reason is pressure from Taiwan's government, they say. Another may be the cost: Taiwanese laws require companies to pay severance of one month's salary for every year of service. There's also a cultural factor.

"The Western way is just too brutal," said Chang Chia-yua, 28, an engineer who supervises production for a computer memory maker in Hsinchu.

In the U.S., corporations have generally balked at across-the-board pay cuts and leaves as an antidote to a business downturn. As companies eliminate jobs at a furious pace, some managers see layoffs as an opportunity to prune their staffs and keep the strongest performers.

Their logic: "You reduce wages and you might piss everybody off, whereas if you dump some of them on the street, they're gone and you don't have to worry about them," said Jim Klein, an adjunct economics professor at Savannah Technical College in Georgia who has three decades of industrial relations and corporate experience in Taiwan.

Sharing the pain with everyone may not be the most efficient approach, people here concede, but at least everybody has a job. It gives some security to workers and also has helped curb the island's unemployment rate, which hit 5.3% in January, up 1.5 percentage points from a year ago. California's jobless figure rose almost as much in a single month, spiraling to 10.1% in January. (The U.S. rate was 8.1% in February.)

But as Chang and others in Hsinchu are finding out, the Taiwanese way can be pretty cruel too -- and may in the end prove no better than layoffs for some people.

When his company started to get walloped by the global financial crisis in November, Chang and his colleagues were told to take three or four days off without pay that month. Chang didn't mind so much at first; the single engineer used the time to volunteer at a nearby hospital, greeting and helping patients and their families with their questions.

But then, as business fell further this year, Chang's employer, whom he was reluctant to identify, told workers to take eight or nine days off a month. In February, that sliced a third of Chang's $1,325 monthly salary. Worse, he and others fear that eventually there will be layoffs.

"The atmosphere in the company is pretty nervous these days," he said. "After all, we have been having unpaid leave for so long."

So fearful are some workers that they're going into the offices on their stay-at-home days to impress bosses in the hope of keeping their names off any existing or future layoff list.

"It sucks," said a 40-year-old engineer for a flat-panel screen manufacturer, who would only give his last name, Tsai, because he didn't want to draw any attention and increase the risk of losing his job.

Tsai was sitting in a dimly lit Starbucks on a rainy February afternoon at Hsinchu's leafy campus, commiserating with a fellow engineer who was also on unpaid leave. Both men said their bonuses had been eliminated and that they were currently required to take one day off a week.

Tsai's rest day was Friday, but he didn't take a long weekend trip with his wife and two children. "We don't go shopping anymore. We eat at home." In fact, he went to work that day.

"I just show up and try to tell the boss I'm still working," he said with a wry smile. "I don't know what else I can do."

In recent months, distraught workers from Hsinchu and elsewhere have massed in the capital city, Taipei, to complain about their shrinking paychecks as employers add more days of unpaid leave. In one demonstration, workers hoisted rice bowls and banners saying, "No Work, No Pay," and demanded that the government stop employers from forcing workers to take leaves and cutting workers' pay below the national monthly minimum wage of about $500.

So far this year, the 430 companies at Hsinchu Science Park have largely held the line on mass layoffs, said Tu Chi-hsiang, deputy director-general of Hsinchu park, which is run by the Taiwanese government.

For all of last year, he said, about 4,400 people lost their jobs, mostly in the fourth quarter. Most of them were temporary employees and contracted foreign workers, mainly from the Philippines.

Overall, the figure pales next to job cuts announced recently by companies in California's Silicon Valley: 24,000 at Hewlett-Packard; up to 6,000 at Intel; 5,000 to 6,000 at Sun Microsystems; 1,500 to 2,000 at Cisco Systems; and more than 1,000 each at Yahoo and eBay.

"The U.S. is more efficient in operations," said Scott Huang, an associate researcher at Hsinchu's administration. "We pay more attention to tradition."

As in Japan and South Korea, larger Taiwanese companies tend to be more paternal, and workers still cling to Confucian values of loyalty and identify with their employer.

Huang says many workers are making good use of their unpaid leave. Some are taking training courses in management subsidized by the government. One large group of engineers and technicians, he says, formed a cycling club, riding up the hills in nearby Fei-feng Mountain on their days off.

Hsinchu itself evokes images of Silicon Valley, with its tree-lined streets, low-rise buildings and dorm-style apartments. The science park, about 45 miles southwest of Taipei, is dominated by manufacturers of semiconductors, computers and peripherals -- Taiwan's mainstay exports, which have been clobbered by the global economic downturn.

Siliconware Precision Industries, one of Hsinchu's largest companies with 15,000 workers, shows just how fast and hard sales have fallen. Siliconware supports semiconductor companies, assembling and testing wafers.

"Prior to the fourth quarter [of 2008], we were doing very well," said Janet Chen, investor relations director. Then the bottom fell out: Revenue plunged more than 50% in January from the previous year. Sales were off 35% last month.

Siliconware began by cutting expenses, including phone bills, travel and entertainment. Salaries were slashed 10% to 15%. About 200 mostly temporary workers were let go, Chen said. Then, most everybody else was told to take four to six days of unpaid leave a month.

"Management doesn't want to cut jobs right away," Chen said. "It's very sensitive. . . . The government may say something."

Taiwanese officials worry about social unrest and other destabilizing effects of mass layoffs, including further erosion in consumer spending, exacerbating the pain and deepening the recession.

One weapon the government uses to press its case with employers is the threat of restricting future entry of foreign workers, says Wu Yu-jen, an associate professor of labor relations at National Chung Cheng University in Taiwan's Chia-yi County.

Wu says Taiwanese companies had recruited about 380,000 foreign workers, predominantly from Southeast Asia, to work in factory and other jobs that were previously hard to fill. Thousands of them have been let go in recent months, but when the economy improves, employers will need government approvals to bulk up again.

"The government can freeze the number of foreign workers if they don't listen," Wu said. On the positive side, he said, Taiwan has been giving training subsidies for each worker on leave.

Wu and other analysts say it's too early to tell how long Taiwan's no-layoff stand will last.

In the short term, it could be cheaper to put people on leave than pay severance for layoffs. And if business rebounds soon, companies will be positioned to ramp up production quickly by adding hours.

But if the unpaid leaves drag on, that could demoralize the staff and add to the financial hardship for employees and the company.

"It really comes down to your best-guess estimate: How long is this going to last?" said Klein, the Georgia economics professor and consultant to businesses in Taiwan. "It's tough, tough, tough," he added, because the outlook is so foggy.

"There's no visibility," he said. "You've got to make a gamble in this environment."

Cao Jun in The Times' Shanghai bureau contributed to this report.

One layoff leads to another

2009-04-03T09:31:00.000-07:00

When customers sit beneath an intricate gold mural, order kung pao chicken and confide that they've just lost their jobs, waitress Alice Lau understands their hurt and fear. She's feeling the pinch too, as the repercussions of decisions made by others trickle down to her.

Her hours at the Great Wall Chinese restaurant have been cut because regulars such as Rogelio Valdez can no longer afford dinners out. Some customers come in for one last meal to tell her they've been laid off, then disappear.

Valdez, a barber, said business at his shop was down. He no longer sees customers such as Dave Vasquez, who shaved his head to avoid spending money on haircuts.

Vasquez had worked as a nanny for Bill Maxwell. But when Maxwell lost his job with a Pasadena video game company, he was forced to let Vasquez go. The start-up had no money to pay its workers after a major publisher, spooked by signs that the country's economic troubles were worsening, canceled a contract in August.

As the recession deepens across the country, touching millions of individuals, it links people through countless cutbacks and layoffs. One job loss leads to another, much the way a wobbly domino can topple the whole row.

Minor financial decisions -- a penny pinched here, a dollar saved there -- build, rippling through a chain of strangers.

::

The loft in Pasadena's antiques district was funky, with Victorian chandeliers, exposed brick and a bathroom plastered with turquoise tiles. It seemed the perfect space for the video game start-up, WhiteMoon Dreams.

Founders Scott Campbell, 36, and Jay Koottarappallil, 32, moved out of their home offices and into the rented loft in August 2007. Soon after, a major video game publisher agreed to buy the shoot-'em-up game they were developing. The pair hired a dozen people and a handful of contractors. Everything seemed to be coming together.

Then the stock market started its free fall. Publishers grew skittish about spending money. The founders could see calamity coming, like someone anticipating the breakup of a relationship but powerless to do anything about it.

Last summer, a year after agreeing to the sale, they were crushed when the publisher, which they would not name for legal reasons, said it could no longer buy the game and brought in lawyers to unwind the deal.

But the founders didn't want to give up. They told employees they could stay -- if they didn't mind working for free. Six remained and have picked up a little work, but nothing yet that could revive the company's fortunes.

The stress is accumulating as WhiteMoon Dreams prepares to show off the game -- appropriately named Salvation -- at the Game Developers Conference this month. The founders hope to find a buyer for the project or a publisher that will hire the company to write something new.

Campbell and Koottarappallil feel the pressure of coming to work every day and not knowing whether it will be the last, of depending on family and friends and the unemployment office for money to survive, of watching yet another rent deadline or mortgage payment approach, of wondering who among them might decide to call it quits.

"Everything's on hold," Campbell said. "It's a waiting pattern to see how everything shakes out."

They set a Dec. 31 deadline to shut down the company but couldn't pull the trigger. They sit, work and wait. But some of their employees and contractors couldn't do the same.

Bill Maxwell, a writer who created plots and dialogue for the game, had a family to support and needed a salary. His initial contract ran out in June with an understanding he'd start another job for WhiteMoon Dreams in November.

But when the publisher backed out of the video game deal, the company couldn't afford to hire him again. Without any work on the horizon, Maxwell had to make some changes of his own.

Maxwell and his wife, Nikki, can rattle off a long list of things they've done without since he stopped working for WhiteMoon Dreams.

Their kids, ages 9, 6 and 3, are familiar with them too: No more sushi, lattes or Whole Foods groceries. No trips to Disneyland, indoor playgrounds or bowling alleys. No new books or DVDs. No fixing the tub in their second bathroom. No healthcare.

Bill, 41, spends hours sitting in the study of the family's one-story home in North Hills, searching Craigslist for jobs as leafy trees gently tap on the windows. A child's drawing taped to the bookshelf says, in shaky writing, "I am thankful for my dad."

Nikki, 39, was laid off from a job writing grants at a charter school last fall. When money grew tight, she surrendered to friends' counsel and picked up staples at a food bank in the Valley, although she was more used to donating and volunteering there. She choked up when, in addition to rice, beans and canned vegetables, she was given a sheet cake to share with her children.

Grief and anger have swamped the Maxwells at times, causing them to wonder whether things will ever change. How long can you look for a job without losing hope?

It's been tough, they say, being consigned to their cluttered home. They have spent days in sweat pants, stepping over crayons, guitars and piles of toys, and having to say no when their son asks for a Popsicle because there's just not enough money for treats.

"We had to make some hard choices," Nikki said, tucking a yoga mat into a wicker basket and glancing outside at a child's bike abandoned in the middle of the yard. "The bottom line is, I still have to feed my family."

That meant adding one more thing to the do-without list: their good friend and live-in nanny of six years, Dave Vasquez.

On a warm day in January, Vasquez peered in the mirror and saw a carless, cashless vagabond looking back at him. His eyes were bleary from nights of tossing and turning on couches, his skin sallow from eating TV dinners. His hair was scraggly and needed a cut.

Life changed dramatically after the Maxwells laid him off in August. Vasquez began a routine of couch surfing and job hunting, living off food stamps, taking buses around Northridge to look for work, hoping employers wouldn't mind that he had been arrested once years ago -- for stealing a loaf of bread.

Days meant heading to the employment office or scavenging for cigarette butts that, when combined, might contain enough tobacco for a smoke. Nights, he waited for darkness so he could retreat into the reprieve found only in sleep.

"You just do what you have to do to make sure tomorrow comes," Vasquez said.

Worst were the days spent in offices waiting for food stamps. He couldn't help thinking that he didn't belong, that he was different from the people there.

Each week, more people seemed to show up at the employment office looking for work, and the 36-year-old Vasquez wondered how he could compete. His scattered resume listed jobs at comic-book shops and in construction, as a cooking instructor and a record-store clerk.

So when Vasquez stared in the mirror on that January day, five months after being laid off, he knew he needed to look more professional. He glanced in his wallet and saw that he didn't have enough cash for a cut from one of the barbers he had frequented in the Valley.

Vasquez then picked up a 10-year-old pair of clippers, pulled off the plastic guards and shaved his head.

Proof of the sputtering economy has crept close to Rogelio Valdez's storefront on Reseda's Tampa Avenue. His neighbors' windows are covered with filthy "now leasing" signs. On the median, posters announce blowout sales at fabric stores and mattress warehouses.

Inside, Valdez's old-fashioned barbershop looks immune to the passage of time. From two framed paintings, Marilyn Monroe winks at the men sitting in red leather barber chairs so old they have built-in ashtrays. The red, white and blue barber pole rotating outside matches the tinfoil American flags that flutter above the door.

But not even a business offering $12 haircuts is spared the fallout when people such as Vasquez decide to scrimp. Things began to slow in January, Valdez said, and supply costs kept climbing: shampoo and scissors, hair spray and after-shave, trimmers and razor blades. So far this year, business is down 20%.

"The whole world's cutting back," he said.

Valdez, 64, now works longer hours -- seven days a week from 9 a.m. to 6:30 p.m., except Sundays, when he closes a little early to visit family in the Valley.

It's just bad timing, he said, that things started to slow seven months after he and his wife took over Medina's Barbershop from its previous owner, who had retired.

Valdez has been a barber for 40 years. Now he's working for himself, just as he had hoped to do as a young boy in Jalisco, Mexico. He decided then to enter the trade because he was told he could cut hair his whole life, even as an old man. He's glad that he's able to work extra hours to keep his doors open.

Not that it won't take some sacrifices, Valdez said as he brushed hair from a customer's shoulders. No more vacations to Las Vegas. No more unnecessary long car rides when the price of gasoline seems as unpredictable as the traffic patterns on the commute from his home in South-Central Los Angeles. No more dinners out at his favorite restaurant, the Great Wall, a few blocks away.

During the lunch rush, business at the Chinese restaurant is sluggish. Bowls of fried won tons line the counter, uneaten. Blue-and-white dishes are set atop empty tables as if waiting for a party to begin.

When people such as Valdez stopped coming in for meals, Great Wall owner Wilson Chien was determined not to fire any of his 11 staffers. He instead reduced each employee's hours by one day a week.

For Alice Lau, the $600-a-month pay cut means more years of pouring tea and delivering steaming plates of food.

"I'm getting older, I wanted to retire, but my investments went down a lot," she said, her short hair showing barely a trace of gray against her uniform of white tuxedo shirt and black bow tie.

Lau, 51, has seen hard times before. She emigrated from Hong Kong at 18 with a fifth-grade education and earned a living sewing in backrooms of tailor shops. She divorced and raised her three children alone. The Chinese restaurant she bought tumbled to the ground during the 1994 Northridge quake as if it were made of twigs.

Her kids are grown now. But one son is a student and her daughter works at a movie theater, so they still live at home, and Lau pays their insurance and cellphone bills. They try to help her with their salaries whenever they can.

"We're just hanging on," she said.

She's lucky though, Lau says as she shuffles between tables, placing a bowl of noodles here, a plate of fried pineapple balls there. She has good kids who "came up well" and a job she loves.

Still, Lau has had to make changes to make ends meet. She eats dumplings at home instead of dim sum in Alhambra. She blow-dries her hair rather than make weekly visits to Kim's Upper Cut, the salon next door. Her son does the yardwork at their West Hills home; Lau decided she could no longer afford the gardener who came weekly.

The gardener and the hairdresser surely pared their budgets too, adapting to the slowing economy. The ripple effect continues, although those affected may not know how they were swept up in it or where it might end.

L.A. Unified board OKs layoff notices to about 9,000 employees

2009-04-03T09:26:00.000-07:00

The Los Angeles Board of Education approved issuing preliminary layoff notices to about 9,000 employees Tuesday despite a large demonstration by the teachers union and some board members' concerns over potential harm to educational quality.

In separate votes, the board approved sending letters to about 2,000 permanent elementary school teachers and about 3,500 probationary teachers informing them that they are in danger of losing their jobs.

The rest of the notices are going to non-teaching personnel, including counselors and administrators.

Before layoffs could occur in the nation's second-largest school system, the board would have to approve the terminations in June.

Board member Julie Korenstein voted against both measures, and Richard Vladovic voted against one and recused himself in the other. Marguerite Poindexter Lamotte also abstained from a vote.

Because of the state and national fiscal crises, the district is facing a nearly $700-million shortfall over the next 18 months.

District officials said they hope to avoid laying off all of the employees who will be given notice.

But Supt. Ramon C. Cortines cautioned that the district's deficit might grow. "If the revenue continues to be in the tank, we believe we will take another hit," he said.

Some board members said they were concerned that layoffs would harm the quality of student educations.

"You can't have a reduction in force of this magnitude and meet everyone's needs," Marlene Canter said.

Teachers union officials warned before the meeting that their members would perform an act of civil disobedience that could result in arrests. After protesting outside the board room, union President A.J. Duffy interrupted the meeting by speaking out of turn when it began.

"You know I'm not leaving the rostrum," he said as board President Monica Garcia admonished him.

"You are out of order," she said.

Union members, wearing red, sat in a semicircle around Duffy as the school board moved its meeting to a side room. Union members shouted "Shame on you!" and Korenstein, a strong union supporter, faced the crowd and put a hand over her heart before leaving the board room.

School district police ordered the group to disperse or face arrest. About 50 district employees who had been pre-screened by union officials remained behind, but police did not detain anyone.

The group remained in the board room, giving interviews to news media and discussing their concerns about larger class sizes and their students' education.

"This country we love was born out of civil disobedience," Duffy told the crowd.

The group left after nearly three hours to join another protest outside the building.

"We'll be back here to stop the cuts!" they shouted.

Writers Guild to cut workers amid shortfall

2009-04-03T09:22:00.000-07:00

Confronted with a growing budget deficit, the Writers Guild of America, West plans to cut about 20 positions by the end of the month.

The guild, which has about 185 employees, notified worker representatives last week that layoffs, which could begin this week, were needed to plug a budget hole of more than $2 million, said two people familiar with the matter. The union, which has 8,000 members, has annual operating expenses of about $25 million.

David Young, the union's executive director, recently told the guild's board that he was considering job cuts to close a budget shortfall, which guild officials have largely blamed on investment losses caused by the stock market decline and a sharp falloff in jobs and work for writers during the last year.

A guild representative declined to comment.

The layoffs can be directly tied to the tough times for Hollywood writers.

As scripted shows went dark during the 100-day writers strike last year, television networks beefed up production of reality programs -- which typically don't use union writers -- to fill the airwaves. That continued after the strike ended in February, creating fewer opportunities for writers. Some scripted shows didn't come back, while others returned with fewer episodes.

Writers also found it harder to command the same fees as they had in the past for work on network shows, which have been losing viewers to the Internet. More recently, the slowdown in work has been exacerbated by networks' ordering fewer pilots for new series.

All of which has meant less money rolling into the guild's coffers. The WGA's income depends on how much its members earn. Guild members, as part of their union dues, are required to contribute 1.5% of their earnings each quarter.

Also contributing to the budget shortfall, people familiar with the union's finances say, is the guild's ongoing campaign to organize writers in the reality TV sector who work behind the scenes crafting dialogue for programs. The guild spent about $400,000 on the drive last year, a person familiar with the situation said.

Some of the 20 positions could be eliminated through attrition, resulting in fewer layoffs. Affected employees will receive severance packages and a guarantee that they will be rehired if the union's finances improve.

SAP layoffs

2009-04-03T09:15:00.000-07:00

SAP appears to be executing its layoff plan this week, which it announced back in January. In an open letter then to employees, SAP co-CEOs Henning Kagermann and Leo Apotheker announced that the workforce reduction would impact 3000 employees, or 5.8% of SAP's workforce.

Although a small number of SAP folks were let go in January, the remaining number appear to coming in waves, one of which is occuring this week. I first noticed an increasing number of hits to the Spectator from Google, under keywords "SAP layoffs" earlier this week. The only confirmation seems to be coming from Twitter.

At a minimum, based on Twitter status updates, layoffs appear to be taking place in Palo Alto yesterday and today. There also appear to be some layoffs that took place in Israel last week, and in Australia the week before.

20 Ways to Preventing Layoffs

2009-04-01T10:26:00.000-07:00

1. Do the right thing all the time. This means making the tough decisions not to hire in the first place or replace less productive positions. Use attrition to make the necessary cuts. Make the tough decisions now rather than later. It just gets more complicated with time.

2. Hire well. It has been difficult in recent years to find good people. But sometimes it’s better to have a position vacant than to hire poorly…especially in management. One bad manager can take down ten’s to thousand’s with them.

3. Stay on a low fat diet. Exercise and keep your company fit by continuous improvement. Productivity is the intermediate measure of health and if it’s not always going up, you are becoming less competitive.

4. Use your resources wisely. I call this CEO or Cost-Effective Organization thinking. Manage your financial, time, people, space, knowledge, energy, and material resources well.

5. Read the tea leaves. Use both the pessimistic and optimistic views of the economy to shape your business decisions. Some of you companies are so large you have your own economists and we all have the Federal Reserve and others. Listen to them (with a grain of salt) and test the party line against reality and the predictions.

6. Partner. Partnerships and joint ventures can allow you to leverage your core resources and push the variability to others or reduce it.

7. Have everyone in the company on the team. Use methods such as the Profit Improvement Process to give everyone some level of influence over and responsibility for profits. It sure beats the adversarial approach.

8. Stop being selfish. Make decisions for the greater good of the corporation instead of the insular betterment of top management. Your people just may be more important than your bonus.

9. Beware the siren song of “across-the-board.” You may find that your company has a 10% disadvantage in the market but a 10% across-the-board cut is guaranteed to take out muscle as well as fat. Adjust your business unit by unit.

10. Listen to the pessimists. Those naysayers you are tempted to quash have something important to say. Listen but then take positive action on that negative view.

11. Prepare your contingency plans. You are much better off to have a plan to review if something bad happens than to have to invent something in the heat of a crisis.

12. Use overtime. Covering peaks in business with overtime allows you to scale back without layoffs when things slow down.

13. Manage your inventory. If you have missed the economic tea leaves, your next indicator may very well be your inventory or backlog. Anticipating a slow-down can mediate the impact.

14. Don’t expect to placate stock analysts with a mass layoff. There is unlikely to be a long-term positive impact on stock price just because you announce a cutback. It may be a cop out.

15. Invest in new products. New products are the only prevention for premature obsolescence. If you don’t develop internally, partner with those who do or buy new products. You must know where your products are in their lifecycles and plan accordingly.

16. Invest in new processes and technologies. Keeping up with the Joneses is vital. Just make sure you pick the right benchmarks to emulate. Watch out for fads! For at least some period of the 1990’s mass layoffs were a fad.

17. Watch your expansion. Expansion is fun but excitement can create a fog that hides the pitfalls of rapid growth. This is especially true when capital dries up in the middle of a growth spurt. Build revenues based on contribution margin and profitability not the top line.

18. Check your egos at the door. Be a team player. Use your drive for success in a positive way rather than just for self-aggrandizement. The failure to look out for others has taken many entrepreneurs and managers down along with their employees.

19. Stop shuffling the deck chairs on the Titanic. If a business unit isn’t achieving its goals, it is unlikely to get better if you just shuffle the staff around. Find the fundamental problems and fix them. Start with the top people. They set the tone.

20. If you have to make layoffs, do them the right way. Communicate, communicate, communicate, and get everyone involved. Have a clear and fair policy on what people are going to get. Take care of both the people being laid off and the survivors. Everyone will have pain and, hopefully, healing to experience. Help them. If you’ve run your company well to this point, they should understand that you have done everything you could to avoid this outcome. This will help you avoid future, bigger layoffs.

It’s not easy to be a manager or entrepreneur today. It never has been and it takes more than twenty tips to succeed. We always carry a responsibility for the people who work for us. This is our highest calling.

Sprint to lay off 8,000 by April

2009-04-01T10:10:00.000-07:00

The reductions should reduce labor costs by $1.2 billion, the company said. About 850 of the layoffs are expected to be eliminated through a voluntary separation plan begun last year. The company employs a total of 56,000 workers.

The company posted a net loss of $326 million in the third quarter of 2008 and a net loss of nearly $1.2 billion for the first three quarters of 2008. Sprint Nextel, which plans to release its fourth-quarter numbers on Feb. 19, lost 3.5 million mobile-phone customers between the third quarter of 2007 and the third quarter of 2008.

CEO Dan Hesse said the reductions were necessary, even though the carrier has made improvements in customer service that have resulted in higher satisfaction ratings in customer surveys. Head-count reductions in customer-care functions will be less than those in groups that don't interact with customers, he added.

The carrier also said it will suspend the 401(k) matches for workers for 2009 and extend a freeze on annual salary increases started in 2008 through 2009. A tuition-reimbursement program was also suspended.

Sprint has about 51 million customers and is the third-largest wireless and wired carrier in the U.S.

Later, Sprint spokesman James Fisher confirmed earlier reports that Kathy Walker, Sprint's chief network officer, will leave Sprint at the end of March since her position was eliminated as part of today's layoff news. He said that Walker and Steve Elfman, the senior vice president of network operations, will be working on a management plan for networks and IT in coming weeks. "We are committed to maintaining the high quality of our networks," Fisher added.

Gartner Inc. analyst Phillip Redman said Sprint has been on a downward "spiral for years," adding that integrating Nextel was a major cause. But the biggest cause is that Sprint has struggled to find a strategy that differentiates it from competitors.

The "desire to be all things to all people has caused much of its problems as competitors have pulled ahead with stronger and broader offerings," Redman said. "Sprint needs to define its strength in the market, focus on those customers and improve its service. Unfortunately as it turns down call centers, lays off people and continually reorganizes, it [falls] further behind."

Problems with Sprint's financial numbers started years ago, and the poor global economy is "keeping Sprint down," despite improvements in the first half of 2008, said Jeffrey Kagan, an independent analyst. Hesse was hired more than a year ago, and a strong focus on customer service to prevent subscribers from defecting seemed to be working, he added.

No job losses after April, says Commerce Secretary

2009-03-31T08:39:00.000-07:00

With key industrial sectors like automobile and steel showing signs of recovery, the government on Thursday said it expects arrest in further job losses in a month or two.
"I think by April end whatever job losses would be there that's the end ... no more job losses will take place," Commerce Secretary G K Pillai told reporters here.

The situation would stabilise from May onward, he said. However, Pillai said orders for exporters would pick up after the Christmas.

Automobile and steel sectors had posted a healthy growth in February. The domestic steel output went up by 2.8 per cent to 4.74 million tonnes in February.

Domestic passenger car sales went up by 21.8 per cent to 1,15,386 units in February from 94,757 units in the same month last year.

President of the Federation of Indian Export Organisations A Sakthivel last week had also expressed confidence about demand for low priced Indian merchandise reviving in the US stores from May.

Half a million jobs were lost during October-December 2008, according to the Labour Ministry estimates. The export oriented sectors such as gems and jewellery, autos, and textiles were affected the most as exports started declining since October.

Buying cars in 2009: Recession, auto industry slowdown and US bankruptcies

2009-03-31T08:33:00.000-07:00

Thinking of buying a car, and feeling financially secure enough to pay the EMIs? This could be the best in a long time to take the plunge. Carmakers across the spectrum have cut prices by upto Rs 40,000, following the tax cut by the Unon government. The four percent cut in value-added tax was just what the doctor ordered.

The tax cut, however, did not happen in isolation. Governments across the world have been trying their best to boost sales in every sphere on the economy, where people have drastically cut back on spending. Across the world, sales of consumer goods - especially cars and homes financed by EMIs - have been declining, with mounting job losses and ?fear of potential job losses preventing consumers from taking loans.?

India has been relatively unaffected by the direct impact of the economic slowdown; however, the ripple effects are very much here. Despite the government’s sops, auto sales have declined in November by 18%.

?As demand slows down, auto makers like Tata Motors, Hyundai and Ashok Leyland have cut down production. It is unlikely that sales will rise in December either, forcing carmakers to keep prices low until the time demand picks up. In December, customers generally prefer not to buy vehicles and wait for the new year. The real impact of the tax cut, if any, will be clear in ?only by the end of January 2009. Most car launches planned for India towards the begining of 2009 have already been quietly pushed forward by ‘a few months’.

Big Three bankruptcies

Looming over the bleak economy is the potential collapse of America’s Big Three automakers - General Motors, Chrysler and Ford. If any of these companies with trancontinental operations go bust, it can spark a chain reaction, pulling down operations in numerous countries, affecting even successful rivals lke Toyota and Honda and leading to millions of jobs losses across borders.

It is true that the Indian arms of the troubled three US auto companies have been doing rather well. However, buyers tend to avoid cars which have foreign parents in trouble. ?This is because they fear a potential disruption in services and warranties if the parent companies go bankrupt. Remember what happened to the parts supply for the cute Matiz in India after its Korean parent Daewoo went bankrupt? In the US too, General Motors has - so far ?- shied away from filing for restructuring under bankruptcy, since it fears that people will not buy cars from a company under Chapter 11 protection. A bankruptcy at any of the Big Three can, in theory, force consumers to cut out that company’s cars while looking for a new set of wheels. This could be true of consumers in India as well.

The billion-dollar auto bailout

After much leading and grovelling, the US car CEOs managed to get a $15 billion loan from the US government, which they must repay by March if they fail to come up with a viable restructuring plan during that time. Simply put, they will have to cut thousands of jobs, renegotiate many contracts, abandon several car brands and get their creditors to agre to easier repayment terms. This is not going to be an easy task for the employers nor he employees, but that is the only way these companies will be able to keep their heads above water during these stormy times. And, since the loan is tied to their ability to restructure viably, a potential failure to do so can still drive them to bankruptcy.

Component companies

The auto bakruptcies can create a riple effect across nations. In India, China and Mexico, there are thousands of companies supplying a steady stream of parts - ranging from light bulbs to transmission systems - to the Big Three automakers in the US. With car sales declining in the US, these suppliers are ?already in trouble and a bankruptcy at Detroit can send hundreds of them belly-up across countries, and render additional lakhs of workers jobless. Just last financial year, India exported Rs 14,400 crore worth of components to the US alone.This year, it will be substantially less.

Now and beyond

Plus, there is the fact that in India, the effects of the slowdown are already well visible. The days of quick job-hopping are over, and so are big increments are salary hikes. Unlike the average customer in the US, Indians have always been keen on saving. With uncertainty on the horizon, the Indian customer is saving even more - and as they save more, the less they spend, leading to a further showdown in sales in all industries. It is a vicious circle, with no easy way out.

There is a silver lining in all this, though. A restructured US auto industry might turn out to be leaner and meaner. The Japanese companies are more efficient and are working towards even more efficiency, learning the right lessons from the crisis. No one expects the slowdown to last more than an year, though things would be tough in that period for sure. However, anyone who is financially secure and have plans for a car should not think twice. After the tax cut, prices for vehicles are really atractive, and dealers desperate for sales might offer even more discounts. If you are really in the market for a car, the time is perfect. And by buying one, you might even be doing your bit to keep the economy afloat!

After layoffs - Next steps for managers

2009-03-30T10:45:00.000-07:00

The layoff announcements keep coming and are unlikely to stop anytime soon. This week,among other news, we learn Alcoa will layoff over 13,000 employees and Macy’s is closing stores. Most of the media attention focuses on the plight of those who lose their jobs. This is appropriate since those laidoff due to industry-wide economic forces have a difficult time finding new jobs, as those in the financial services industry can attest.

Another group of people with a challenge after layoffs are the managers left with the task of motivating and focusing the nervous and possibly demoralized remaining employees. Managers can act to can make the post-layoff period a time of momentum building and innovation.

1. Vision and Mission work. Every employee knows times are difficult and everyone is asking themselves the question ‘Will our organization survive?’ Don’t pretend this private questioning isn’t happening. Confront it head on with a conversation about the mission of the organization. What makes the company special? How do the economic difficulties create opportunities to re-ignite the vision? How can each employee contribute to the mission? A vision is not a luxury during a time like this. Employees are looking for a reason to believe in the future of the organization. Give them one or, even better, create one with them.

2. Invite Innovation through Flexibility. Your employees know the business as well as anyone. Give them the autonomy to help solve the organization’s challenges. Share what you know about industry headwinds and future trends. Invite your employees to find solutions or new market niches to exploit the changes in the industry.

3. Initiate new Communication Channels. Find a way to institutionalize new internal communication modes. Make it clear that employee ideas are welcome and create a new forum to report out to your employees and hear back from them. This could be a weekly video conference, a monthly meeting, a company wiki. The structure the works depends on the culture of your organization.

4. Start a new strategic planning exercise. A good strategic planning process trains participants to think strategically and think differently about their industry. If your goal is to get employees throughout the organization to innovate, then you want them to be able to innovate in a strategic manner. Initiate a strategic planning exercise as a training and employee development task. The main goal is not to create a new strategy but to get your employees to better understand the current strategy, help modify the strategy to match the new environmental constraints, or help guide their innovative thinking.

5. Build an internal expertise and knowledge development network. The destruction of informal knowledge networks is a hidden cost of any layoff. Often the informal knwoledge is not even recognized until it disappears after the layoffs. The post layoff time is ideal for building a snapshot of the expertise network within the organization and using this to identify mentors and opportunities for employee development.

The bottom line is to give employees a sense that they have some control over the future of the organization and that the future of the organization is strong. Since the recent past of the organization did not go so well, the only way to create some positive momentum is to take real, visible action demonstrating why the future will be different.

Levy sends layoff notices to 2,200 Suffolk workers

2009-03-30T10:44:00.000-07:00

County Executive Steve Levy sent out layoff notices to 2,200 county employees Friday and agreed to use $30 million from the county's rainy day fund to equal what he is seeking in union concessions.

The 60-day warnings, which went out by letter, are sent to a far larger number than the 386 positions on the layoff list because the county also must notify those who would move to lower job titles under the county's bump and retreat system.

Cheryl Felice, president of the Association of Municipal Employees, called the notices "completely inappropriate intimidation" since no layoff proposal has been approved or has even gotten out of the county legislative committee.

"It's classic abuser behavior," said Felice, "Management is trying to bully union members into accepting concessions prior to Mr. Levy proving his case."

"If she's suggesting that we not send out these notices, she would be asking us to the violate the law," said Levy. "Cheryl continues to place her upcoming election as a priority over protecting her membership, which understands that a lag payroll is far more humane than layoffs."

In meetings Friday, Levy agreed to add $5 million to the $25 million he'd earlier agreed to use from the county's $130 million rainy day fund. An aide said he also agreed to alter his existing resolution to set out major parts of his fiscal plan to solve the $119 million 2009 shortfall.

"We're making progress," said Presiding Officer William Lindsay (D-Holbrook). "Last week, he was only willing to use $13 million." He added, "It would do a world of good if everyone saw all the pieces in one document."

The county executive originally asked for the power to do layoffs if the unions did not agree to $30 million in concessions by April 1. Levy changed the measure to remove the "concession" language after key ally Legis. Louis D'Amaro (D- North Babylon) recused himself from the vote because his wife, county attorney Christine Malafi, would be affected by the proposal.

While Levy has asked for a special legislature meeting April 1, Lindsay has said he sees no need because Levy's proposal is still in committee. Dan Aug, Levy's spokesman, said they are weighing whether to seek a special committee meeting at which D'Amaro now could vote on the stripped-down layoff bill.

The presiding officer, however, said he sees no reason for pressing for action before the April 28 meeting. "There's no difference if it's the April 1 or April 28," he said, referring to the layoff notices. "The clock is already ticking on the layoffs."

Keystone RV layoffs begin April 3

2009-03-30T10:37:00.000-07:00

Goshen-based Keystone RV said today it will move foreword with the previously announced closure of three northeast Indiana motor-home manufacturing facilities beginning April 3.

In a letter to the Indiana Department of Workforce Development, Keystone said it will permanently close two plants in Goshen and one in Howe. The closures will begin April 3, with 103 employees terminated. The company said it will lay off another 80 employees April 17 and conclude with 82 employees terminated May 1.

On Feb. 2, Keystone announced its plan to consolidate manufacturing facilities and lay off 350 workers, or 15 percent of the company's total work force, as part of its effort to improve efficiencies.

Keystone's plants in Goshen are located at 2775 and 2642 Hackberry Drive, and its Howe plant is located at 7605 N. SR 9.

McClatchy layoff info

2009-03-30T10:17:00.000-07:00

Here is the current layoff info as of March 19, 2009 (includes info from Anchorage Daily News)

Alaska

Anchorage Daily News
47 employees to be laid off, wage cuts effective April 13, 2009 (details about cuts not yet announced), possible furloughs 2nd half of 2009.

California

The Fresno Bee:
Total layoffs at the paper = 63. The Guild voted 3/10/09 to support management's plan to lay off 16 full time and 5 part time employees in the bargaining unit. Pay cuts (effective April 13, 2009), furlough option, vacation changes.

salary under $35,000 = no cut
$35,000-$59,999 = 4% cut
$60,000-$89,999 = 6% cut

(More here and here.)

Merced Sun-Star:
10 positions eliminated, wage cuts

The Modesto Bee:
Total of 40 positions eliminated. The Guild voted 3/9/09 to accept management's proposal of 11 layoffs in the bargaining unit. Unpaid furloughs second half of 2009. Pay cuts (not sure when they take effect):

under $25,000 = no cut
$25,000-$34,999 = 2% cut
$35,000-$49,999 = 3% cut
$50,000-$64,999 = 5% cut
$65,000-$99,999 = 7.5% cut
$100,000 + = 10% cut

The Sacramento Bee:
The Guild voted 3/6/09 to accept management's proposal to lay off 34 employees in the bargaining unit, implement pay cuts (effective April 13, 2009), possible unpaid furlough in second half of 2009, and vacation accrual changes. Total employees laid off = 128.

salary under $25,000 = no cut
$25,000 - $50,000 = 3% cut
$50,000 or above = 6% cut

(More at the Guild's web site here.)

San Luis Obispo Tribune
3 laid off by end of March, 4 additional layoffs when some financial functions are outsourced to Fresno Bee, wage cuts

Florida

The Miami Herald
175 employees will lose their jobs, another 30 vacant positions will be eliminated, unpaid furloughs starting in April, wage cuts. The Herald to lease one floor of its building.

under $25,000 = no cut
$25,000 - $50,000 = 5% cut
$50,000 + = 10% cut

Georgia

Ledger-Enquirer (Columbus)
20 positions eliminated (includes 13 vacant positions), wage cuts for those making over $26,000 - cuts range from 2.5% to 8%. (more here)

The Telegraph (Macon)
18 positions eliminated (some through attrition), wage cuts for employees making over $25,000 (2.5% to 10%). 58 positions already eliminated when printing operations were moved to Columbus.

Idaho

Idaho Statesman (Boise)

25 positions, wage cuts, unpaid furloughs

under $25,000 = no cuts
$25,999 - $49,999 = 3% cut
$50,000 - $99,000 = 6% cuts
$100,000 + = 10% cut

Illinois

Belleville News-Democrat
30 positions eliminated (includes 12 p.t. and 3 vacant positions), wage cuts for employees making over $25,000

Kansas

Wichita Eagle:
14 positions eliminated, wage cuts

Missouri

Kansas City Star:
Will eliminate about 150 positions, implement wage cuts effective April 20. Publisher says more information later.

under $100,000 = 5% cut (plus or minus)
over $100,000 = 10% cut

North Carolina

The News & Observer
78 layoffs, wage cuts, unpaid furloughs beginning in May.

under $25,000 = no cut
$25,000 - $49,999 = 2.5% cut
$50,000 - $99,999 = 5% cut
$100,000 + = 10% cut

South Carolina

The Herald (Rock Hill):
6 positions eliminated, wage cuts. Printing operations have already been transferred to Charlotte.

under $25,000 = no cut
$25,000 or more = 2.5% to 10% cut

The Island Packet (Blufton) and Beaufort Gazette:
17 positions eliminated (8 of which were open), wage reductions (5 to 10%), hourly employees cut back from 40 hours to 37.5 hours. Possible unpaid furloughs.

The State (Columbia):
38 layoffs (including 3 VPs), wage reductions

The Sun News (Myrtle Beach):
20 Layoffs, 9.1% wage reductions, 37.5 hours per week effective 5/4/09. (More here and here.) An additional 58 positions were eliminated with the transfer of printing operations to Charleston.

Texas

Fort Worth Star-Telegram:
12% of employees laid off (approx. 130 employees), wage reductions (see below), some voluntary buyouts, reduced hours for operational employees.

Wage reductions (effective with 4/24/09 paycheck):
under $25,000 = no cut
$25,000 - $49,999 = 2.5% cut
$50,000 - $99,999 = 5% cut
over $100,000 = 10% cut (more info here)

Washington

The Bellingham Herald (Washington):
Layoff 8 full-time positions and 2 part-time, totaling 10 people.

under $25,000 = no cut
$25,000-$50,000 = 2.5% cut
$50,000 or more = 5% cut (More here.)
Building is up for sale.

The News Tribune (Tacoma, Washington)
30 layoffs, wage cuts, possible unpaid furloughs 2nd half of 2009 under $25,000 = no cuts

under $25,000 = no cut
$25,000 - $100,000 = 5% cut
$100,000 + = 10% cut

The Olympian
15 layoffs, wage cuts

Tri-City Herald (Washington):
Lay off 3 employees, possible furloughs, wage reductions.

under $25,000 = no cut
$25,000 to $49,999 = 2.5% cut
$50,000 or more = 5% cut

McClatchy Interactive:
9 positions eliminated (6 through attrition), wage reductions.

under $50,000 = 3.5% cut
$50,000 - $100,000 = 5% cut
over $100,000 = 10% cut
.
If you have more info, leave it in comments.

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American Airlines plans to lay off 469 workers at US airports

2009-03-30T10:16:00.000-07:00

As a part of its continuing efforts at downsizing flights, American Airlines, headquartered in Fort Worth, Texas, the United States, has sent notices of possible layoffs to 469 employees at airports in 5 cities in the United States.

These employees may lose their jobs by November 1, 2008, as the airline cuts back on its schedule in the face of high oil prices and a weakening economy.

The hardest-hit by the proposed layoffs would be the workforce at American Airlines’ second-biggest hub, O’Hare International Airport in Chicago, the United States, where 353 employees have received the layoff notices. The company has also notified 53 airport employees in Los Angeles; 28 in San Francisco; 27 in Raleigh-Durham, North Carolina; and 8 employees in Columbus, Ohio.

The letters of possible layoffs were sent to gate and ticket agents, ramp workers, automotive mechanics, and airport-based management and support staff, a press release from American Airlines said.

American Airlines has not yet sent notices to mechanics and other maintenance employees.

The press release added: “The sending of notices to employees follows the capacity reductions the company is implementing to remain competitive in the industry. Unfortunately, those reductions require a reduction in jobs as well.”

Mark Burdette, vice-president (employee relations) of American Airlines, had said in a letter sent to the Transport Workers Union a week ago: “Fewer people would be needed to operate the airline as the operating schedule is cut due to high oil pries and the softening economy. This reality has forced us to make some very tough, but immediate, decisions to secure American Airlines’ future. We must quickly reduce our operating schedule for the coming months, and as a result, will need fewer people to operate the airline.”

American Airlines had earlier announced that it intended to cut about 1,300 hourly jobs and 200 management and support positions in its maintenance and engineering division. Overall, over 6,000 jobs will be eliminated at the airline by the end of 2008 as it downsizes by 8%.

American Airlines is the world’s largest airline in total passengers-miles transported and passenger fleet size; the second largest airline in terms of aircraft operated; and the second-largest airline company in the world (behind Air France-KLM) in terms of total operating revenues. A wholly owned subsidiary of the AMR Corporation, American Airlines operates scheduled flights throughout the United States, as well as flights to Canada, Latin America, the Caribbean, Europe, Japan, China, and India.

American Airlines likely to lay off 410 flight attendants by April 1, 2009

2009-03-30T10:13:00.000-07:00

American Airlines, based in Fort Worth, Texas, the United States, says it is planning to lay off up to 410 flight attendants on April 1, 2009, “unless the carrier can get, by March 6, 2009, sufficient number of volunteers to take leaves, early departures or other steps to reduce their ranks.”

The media quoted a spokeswoman of American Airlines as saying that “the potential furloughs are the result of less attrition than usual” and that “furloughs would be based on reverse seniority.”

She added that the airline expecting to get adequate number of volunteers by January 2009 to prevent layoffs, but owing to the economic depression, American Airlines did not get the normal requests for short-term leaves, retirements or resignations.

More and more people, according to American Airlines, are opting to remain employed longer rather than start their retirement.

American Airlines has 17,200 active flight attendants, including 88 flight attendants based at Raleigh-Durham International Airport, North Carolina, the United States.

The spokeswoman, however, said flight attendants based at Raleigh-Durham International Airport were unlikely to be affected by the furloughs, or a temporary leave of absence, that American Airlines plans for April.

The Association of Professional Flight Attendants had told its members a week ago that it learned of the imminent layoffs from Lauri Curtis, American Airlines’ vice-president of flight service.

American Airlines, a wholly owned subsidiary of the AMR Corporation, had offered leaves of absence and travel privileges for those quitting as well as job-sharing arrangements. The airline said it was resorting to furloughs as a part of its efforts to cope with the global economic recession.

MASS LAYOFFS IN FEBRUARY 2009

2009-03-30T09:54:00.000-07:00

Employers took 2,769 mass layoff actions in February that resulted in the separation of 295,477 workers, seasonally adjusted, as measured by new filings for unemployment insurance benefits during the month, the Bureau of Labor Statistics of the U.S. Department of Labor reported today. Each action involved at least 50 persons from a single employer. The number of mass layoff events in February increased by 542 from the prior month, while the number of associated initial claims increased by 57,575. Over the year, the number of mass layoff events increased by 1,100, and the associated initial claims increased by 112,439. In February, 1,235 mass layoff events were reported in the manufacturing sector, seasonally adjusted, resulting in 152,618 initial claims. Over the month, mass layoff events in manufacturing increased by 497, and initial claims increased by 50,041. (See table 1.) Layoff events for all industries and for the manufacturing sector rose to their highest levels on record, with data available back to 1995.

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How to Survive a Layoff - Ways

2009-03-27T12:31:00.000-07:00

If you’ve been laid off recently, you’re certainly in good company. While that might provide some small consolation, you still want to set a target for yourself and start working towards future goals. You’ll want to make sure you leave on good terms, start looking for a new job in productive ways and also stay sane.

Be Prepared

When job cuts mean that your own days at the office are numbered, you may just want to laugh the whole situation off. During the dot.com layoffs of 2001–2002, a writer for Bankrate.com reported that he and co-workers cracked jokes every day about the visit from HR, until the representative actually arrived. While finally getting the news may be a relief of sorts, there are several technical details that you’ll want to remember in the event of your layoff.

For example, do you need to discuss your stock options with your employer? Will you keep the money in your 401K for your retirement or take it out now? Do you have any vacation pay that’s owed to you? Is it possible to negotiate for a bit more time on the company health insurance? If you’re expecting a layoff, these are things you can think about in advance, but make sure you have time to ask questions, or can contact your employer at a later date.

When the moment arrives, a Fortune magazine columnist advises you to stay composed and clear-headed at all costs. Try not to take your situation personally, and you’ll be able to focus on negotiating the best possible severance deal.

Review your personal finances. Gail Marks Jarvis, investment blogger for the Chicago Tribune, offers preparation tips for a possible layoff, as well as the first moves you should make post-layoff. Start by revising you budget, bearing in mind that it might take a while to find a new job. You still need to keep trying to pay off your credit cards, so it’s a good idea to stop using them if it all possible. You may also have to sell some of your possessions. (Be honest, how badly do you really need that Wii?)

Finding a New Job

Your first instinct after being laid off may be to hit the bar with some coworkers, and that’s fine, but once you’ve had time to process the news, it’s time to get cracking on the employment hunt. The Scobleizer blog reminds you to spend at least 30 percent of your day, every day, searching for a new job. And that means more than just scrolling the pages at Monster.com or Craigslist. Before you even start sending out resumes, you can start to identify yourself as a great candidate. You’ll need to be aggressive, and creative. Start a blog that demonstrates the skills you have. Use your blog to connect with others in your field.

A posting from the SF Microsoft Office Examiner claims that 80 percent of jobs come from networking. While it’s not a great time to be begging people for jobs, there’s never a bad time to ask someone to meet with you and talk about what they do. The more informational interviews you go on, the more you learn and the more connections you make. When jobs do surface, you’ll be at the forefront of people’s minds, putting you at a serious advantage.

If you work in media or technology, display your qualifications online. That means deleting pictures of you and your drunk friends from Facebook and ensuring that “your blog is your calling card,” the Scobleizer blog advises. You may want to cultivate a Twitter identity that makes you look like a thoughtful, professional and then follow potential employers on Twitter. When you’re offline, attend events in your field.

Keeping Your Sanity

There is no way to skirt around the fact that getting laid off is traumatic. Although you shouldn’t treat a layoff like a vacation, you can take some time to become a more well-balanced person. Try becoming more physically active—even if the layoff means canceling your gym membership. There are plenty of ways to get fit without paying gym fees. Play with your dog, do some crunches while watching TV or take up a team sport.

You might be surprised to learn that you can improve your health a great deal by gardening. Plus, joining a community garden will save you a bit on groceries. The American Community Garden Association can help you locate a nearby garden, or even start your own.

If you don’t have a green thumb, try another kind of volunteer work. Chances are, the talents you used at work will be invaluable to a charity organization, and you may even find you have a knack for something you were unaware of, such as mentoring a child. Use the findingDulcinea Web Guide to Philanthropy and Nonprofits to help you locate volunteering opportunities.

10 tips to survive a layoff, financially

2009-03-27T12:29:00.000-07:00

Tough people last, tough times don't, right?

And tough times indeed are upon those Jet Airways [Get Quote] employees who were laid off recently and also for others who fear their turn is coming soon.

In times of recession companies do pare their staff strength to improve their profits. They are accountable to their shareholders and stakeholders.

Similarly, if you are a sacked employee or fear that you may get a pink slip in times to come, isn't it time you become accountable to yourself and think what next instead of cribbing about the fate that has befallen upon you?

Here's what you can do to survive your layoff / expected layoff, financially.

1. Negotiate with your employer to get a good severance package.

In the case of the Jet Airways employees it is reported that the company is willing to pay them a year's salary. This can indeed be good news if it is true.

If you too are laid off negotiate aggressively with your employer. After all, you are already sacked and they can do you no more harm. But remember to keep your aggression polite for the same employer may want to hire you when wheels of fortune turn. Never slap an opportunity, ever!

Getting to hard numbers let's assume that a company A sacks 10 per cent of its employees and promises to pay 12-months' salary in advance. Also, let's assume that on an average these employees earn Rs 20,000 per month. This will help them get Rs 2,40,000 in advance. This amount if planned and spent productively can help them cope financially till the time they get another job.

2. If you have a debt of any kind -- home loan, personal loan, credit card payment etc -- make provision for that first from the money that you can squeeze out from your ex-employer. There is no point in defaulting on your debt as it may come to hound you later -- via your credit rating -- when your financial condition improves.

For those who fear a layoff in the near future it would be a wise decision to payoff their dues when the going is good rather than waiting till the last moment. Also, postpone your decisions to buy a home or borrow money for some other purpose.

However, if you are neck deep in debt then it would be better that you seek advice from a debt counselor. Bank of India's Abhay, ICICI Bank's Abhay helps people with financial counseling and how to cope with debt.

3. In the meanwhile, try to search for job, even if on a temporary basis, matching your skills and profile. Don't hesitate to compromise on salary as your topmost priority should be keeping the engine well-oiled so when the real opportunity knocks you can race ahead of the others.

There are Web sites like Jobs On Temp that list a number of temporary jobs available in various sectors. You can also look out for India's best cities for 'temp' jobs in case you are open to moving out from where you last worked or are working right now.

4. Your next priority should be your grocery expenses. You have to eat to survive and be shipshape to go out in search of another job. Visit your nearest discount stores and check who sells your items of daily need cheaper. This exercise may help you save some dimes but if you are laid off or fear a layoff every penny should count.

5. There is no need to tell you that when you are laid off or are expecting the same you should come down heavily on your socialising expenses including outings to hotels, multiplexes, vacations et al.

6. Try asking your parents and friends for some money in case your severance package amount fails to meet your monthly expenses. After all, a friend in need is a friend indeed. Of course, your parents, if they are financially sound, wouldn't think twice about helping you with money. Make it a point to ask your parents first for money. For borrowing money from your friends can sometimes spoil a friendship.

7. If your severance package is good make sure that you keep at least 20 per cent of this money into an emergency fund. Put this amount in a fixed deposit that will earn you at least 7 to 8 per cent post tax. Due to rising interest rates most banks are offering attractive fixed deposit rates. Also, this amount will come in handy in case of any medical emergency. Of course, you will have to forego the interest amount if you withdraw your fixed deposit before the tenure is over.

8. If charity begins at home, cost cutting too should begin from home. Ask your maid to take a break for three months or till the time you find a new job. It is better you start doing your own laundry, utensils and ironing. You may feel a bit odd in the beginning but the amount you will save every month will come as a huge relief.

9. Spend most of your time fine tuning your resume, preparing for interviews, adding new skill sets related to your job profile (at lower cost if possible, but without any compromise) and networking with people (both online and offline). This will not only help you find a new job but also keep you busy and away from any mischief.

10. Finally, don't forget to make a plan about your future as you will have enough time to ponder over your finances and career. Take a hard look at what you would want to do in life and how your career is shaping up. Make sure that such an eventuality should not ever befall you and if at all it does then you should not struggle as much as you struggled during your first layoff.

Hi readers have any experience in layoff you can share here. contact sendmailtomurugan@gmail.com

How To Survive a Layoff - Tips

2009-03-27T12:27:00.000-07:00

Keep getting up in the morning. You will find another job. Remember, you have skills!
Contact your state unemployment office immediately to get the typical waiting period out of the way of your checks.
Update and polish your resume.
Start searching for a new job right away.
Submit your updated resume to several job sites, to let employers come to you.
Apply to receive job notification by email at job sites that offer it, to let the jobs come to you, too.
Contact your references to let them know you're back in the job market and counting on them.
Ask your ex-boss to write a recommendation letter that also explains why job loss wasn't your fault.
Practice interviewing while you have the time and to keep your confidence level up.
Attend outplacement seminars if offered.
Consider temping until you find a permanent job.

Tips:

You might be able to negotiate a better severance package with your HR department. Ask them about jobs, too. There might still be mission-critical openings to which your skills transfer.
To avoid worry and depression, keep your mind busy and make yourself feel useful by working on your house, car, yard, hobbies, etc.
It could be the best thing that ever happened to you. For example, now might be a good time for that career change, training or self-employment you've been contemplating, but never had the time.

Surviving a layoff with your savings intact

2009-03-27T12:26:00.000-07:00

The layoffs that you've been hearing so much about have swept through your company. You've been booted from your cubicle. You're out of a job.

It's financial crunch time. So act like it. It's time to get serious about the money you have and the money you won't have once that final paycheck gets cashed.

Don't leave empty-handed
First off, you want to make that last paycheck as big as possible. Negotiate the best possible severance package that you can. Work the guilt.

"If you've been a good employee, they probably feel a little bit guilty," says Ginita Wall, a certified financial planner and co-founder of the Women's Institute for Financial Education. "Try to get some sort of golden parachute."

Ask for everything you can. Ask for more money, for continued use of a company car, for help with health care coverage. You won't get anything if you don't ask. So speak up. It's worth a shot.

Don't forget to apply for unemployment.

"You've paid for it. You may as well use it," Wall says.

Who couldn't use an extra couple hundred dollars a month after a job ends?

"If you walked by a couple of hundred dollar bills lying on the ground you'd pick them up. It's not just peanuts," Wall says.

Time for a cash diet
The next step is poring over your budget. It's time to make some serious adjustments.

"Really take a cold, hard look at what you've got coming in," says Howard Dvorkin of Consolidated Credit Counseling Services in Fort Lauderdale, Fla.

Also take a look at what money is going out and why. Decide what monthly expenses you can live without. Do you really need call waiting and three-way calling on your phone? What about all those extra cable channels on your TV?

"Look at your budget and cut back all unnecessary expenses," Dvorkin says.

"You'll be amazed at how thrifty you can get," says Catherine Williams, vice president of financial literacy for Money Management International."There's just tons of things we can do without."

Prioritize your bills. Make a list of monthly expenses that absolutely have to be paid. Topping the list should be your mortgage or rent, followed by utility bills, auto payments and insurance bills.

"We never want anybody to stop paying insurance. Because when they do that's when they have an accident," Williams says.

And don't forget about food. Everyone has to eat, although you should probably pass on any fancy restaurant dinners for a while.

You'll also want to keep paying on your credit card bills even if it's just minimum payments. If you're unable to pay a bill, contact the creditor as soon as possible. Don't wait until you're late.

"Always call before the payment is due. Creditors have more tools available to them before you miss a payment than after you miss a payment," Williams says.

Follow up the phone call with a letter.

"In a short, simple, less than a paragraph note, tell them what happened and ultimately what you want to do," Williams says.

"If you say 'What can you do for me,' they'll say 'Make your regular payments.' Have a number in mind that you can meet."

Say your minimum credit card payment is $50. Offer to pay $30 instead. Be realistic and be sure to pay this amount by the due date.

Emergency calls
If you've got an emergency fund, this is the time to raid it. "This is the emergency you've been saving for," Williams says. "This is the rainy day."

Liquidate low-interest earning investments such as money market funds and certificates of deposit. You may also want to sell stocks and mutual funds. The aim is to free up as much cash as possible to make up for the paychecks you won't be getting for awhile.

Think twice about cashing out a 401(k) or other retirement account. This is not the place to look for quick cash. Tapping into a retirement account should be an absolute last resort."You're going to owe taxes. You're going to owe penalties," Wall says. "People should consider working part-time rather than tapping your retirement account."

Just say no to those little plastic cards. This is not the time to charge up your credit cards. "You must, must cut down and completely avoid using your credit card," Dvorkin says. "Unfortunately, most people do just the opposite. They start using credit cards to live."

Try living off stockpiled goods, instead. Chances are, you've got more food in your pantry and more clothes in your closet than you realize. "Clean out the pantry. Make a meal out of what you find there instead of going out for a hamburger," Wall says.

Really take a look around your place. Do some digging. You may be surprised at what you find. There may be enough for a good garage sale.

"Have a garage sale," Williams says. "That generates a couple hundred bucks no matter what."

Waiting for the shoe to drop?
What about people who are employed but worried that a layoff may be headed their way?

Start building up an emergency fund. Most experts suggest stashing away three to six months living expenses. Do the best you can.

One way to free up more cash is by reducing your contributions to your retirement account.

Avoid making any big purchases. Rein in daily expenses as well. It could be something as simple as taking a packed lunch to work.

Homeowners may want to apply for home equity lines of credit. It will be much tougher to qualify for a loan once you've lost a job. So get a line now just in case you'll need one later.

A good strategy for two-income families is to try to make ends meet on one salary. The second salary could be socked away into savings.

"It's easier said than done," Dvorkin says. "But at the end of the year you'll feel a whole lot better."

How To Survive A Layoff

2009-03-27T12:23:00.000-07:00

With the exception of being let go from a retail position after a store closing when I was in college, I have never been on the receiving end of a layoff. However, I was unfortunate enough to have to deliver the news to team members who worked with me at my last job, and it was one of the most unpleasant experiences I have ever had to deal with at work. Through their painful experiences I have been able to gather a few tips for surviving a layoff.
Sink or Swim

I personally don’t believe in layoffs because I am sort of a “sink or swim” kind of guy. When an employee devotes their time and energy to a company they deserve some loyalty in return. Sink or swim, employees and companies should be in it together. Unfortunately, corporate America is mostly concerned with bottom lines, so they frequently take the opportunity to “weed out” employees who earn too much, produce too little, or are nearing retirement benefits. If “dead wood” exists in an organization it should be dealt with individually, but not by taking otherwise hardworking casualties along with them as part of a massive layoff. OK, enough of my rant, back to surviving a layoff.
Keep Your Ear to the Ground

If your company has announced a round of layoffs it means there are storm clouds on the horizon, regardless of how secure you may feel about your particular job. If you are lucky enough to be notified ahead of time, use this advanced warning to your advantage. Put your financial turnaround on hold and quickly begin stockpiling cash. Here are a few ideas to guide you though this most difficult event:

Pay minimums on ALL debt, nothing extra. It is important not to get behind with storm clouds on the horizon, so continue to stay current on all debt accounts. If you were making additional debt snowball payments, suspend those temporarily until the storm clouds have passed, or until you have found another job.

Pile up cash in an emergency fund. Using the debt snowball amount you were previously paying on that smallest debt as a starting place, throw every single dollar you can find in an emergency fund. Have a yard sale, sell stuff on eBay, and look for some quick-to-hire part time work. This emergency fund will have to sustain your family until you can find new employment, a period that could take weeks, or even months.

Negotiate. When you get your pink slip, negotiate as many benefits as you possibly can before your exit interview is over. Don’t be satisfied to just get a promise of a good reference and any unpaid vacation. Companies, especially large companies, want to make this as smooth a transition as possible to limit any negative publicity. Use that to your advantage and ask for an extension of health coverage, or additional paid weeks per year of service. Work any angle you can to maximize your severance package. Remember, you have a family to feed! Don’t worry about appearing ungrateful, or making anyone mad. What’s the worst they could do - fire you?

Use severance funds first, then the emergency fund. It isn’t easy dealing with a drastic drop in income. Consider depositing severance funds in a separate savings account and set up biweekly withdrawals in roughly the same amount as your previous take home pay. You can set this up with ING Direct. Do not touch this money for any reason other than living expenses and perhaps some small job hunt expenses (travel, new suit, etc.), and in that case be extremely frugal. Remember, this money supply is finite. If you get frivolous now because you feel sorry for yourself you will be broke in no time and find yourself feeling even worse.

Find a new job, and fast. Now is not a time to sit around having a pity party. Get out there and find a new job. Work your network of friends and family. Update your resume and submit using a service such as Resume Rabbit™. Keep in touch with other colleagues who have been rehired and ask them for any leads. Brush up on your interview skills. Learn what not to do in an interview. Treat this job search as your full time job. Sure, it would be fun to take a couple weeks off to rest and relax, but you can’t afford it. The faster you find a job the less you have to use of your severance money, making what’s left a nice bonus towards your financial turnaround.

When employed again use any remaining severance and emergency fund stockpiles to pay off debt, down to the original amount of your beginner emergency fund. Now is not the time to blow money to celebrate. If anything, this experience should have taught you a valuable lesson - there is no such thing as job security. In an ever-changing global economy filled with uncertainty, any work could dry up in an instant leaving you unemployed. There is no better time to get out of debt, build your emergency savings and work towards financial independence.

Have any of you experienced a layoff in your immediate family? Any tips you can share with other readers on surviving a layoff?

Victims of the tech wreck: Life after layoffs for seven dot-commers

2009-03-27T12:20:00.000-07:00

They came from all walks of life seeking all sorts of rewards. Some were risk-takers hoping to be a part of a business revolution. Others simply wanted to try something new. More than a couple were looking to make a quick buck in a hot industry.

Now, seven laid-off dot-commers -- a public relations director, software tester, salesman, office manager, technology guru, facilities manager and Web site editor -- talk about life after the Internet bubble has burst.

Losing your job is never easy. But the way it is handled varies from person to person.

Some, such as former HomeGrocer.com and Bidpath public relations director Stacy Drake, are rolling with the punches, enjoying their time off and looking for the next opportunity.

Others, such as Ken Wiens, a 48-year-old father of two, are struggling to find work and considering going back to school.

And others, such as 28-year-old Shelley Rossi, have retreated from the technology world altogether.

"I took my chance. I did my risky thing," says Rossi, a former Web site editor who turned down an offer at a second Internet company for a more stable job in real estate.

Since May, more than 7,200 people have lost their jobs in the state's technology sector. Here are seven of their stories.

Shelly Rossi
ePods.com
Age: 28
Position: Web site editor
Laid off: June

After being laid off from Internet appliance maker ePods last summer, Shelley Rossi was so distraught that she sat down at her personal computer and penned a 625-word essay about her experiences in the Internet industry.

Called "Easydot.com, Easydot.go," it was her way of dealing with the pain of losing a job she loved.

"So here I am, an ex-dot-commer, laid off in a companywide downsizing due to financial cutbacks," she wrote. "Am I bitter? Absolutely not. Do I regret it? Never. Even if it was for only a short time, I was an integral part of something new and exciting. Something that gave me as much, if not more, than what I was able to give it."

Being laid off was like a "family being split apart," she says. More than 100 people lost their jobs when the developer of handheld Internet appliances shut down last year.

But the 28-year-old quickly bounced back from the experience. Even though ePods did not provide a severance package, executives at the company helped her land a three-month contract assignment at Nordstrom.com a week after she was let go. She was offered a full-time position at the online retailer. But Rossi -- having cleansed herself of the Internet bug -- decided to turn down the offer.

"I feel great about what I did and that I took the risk," she says about her eight-month foray into the Internet world. "But you know how it is after you get burned. Even though I don't feel the experience was negative, I said, 'Do I really want to put myself in a position again where I could be laid off?'"

So in September, one month after getting married, she decided to find a job that was a little more "stable" and "structured." After several job offers, she settled on a public relations position at John L. Scott Real Estate in Bellevue.

Rossi, who filled out four W2 forms this tax season, says she is happy not to be working for a dot-com. "I guess you could say I was ready to join the real world again."

Stacy Drake
Homegrocer.com
Age: 32
Position: Public relations director
Laid off: Dec. 15

Stacy Drake has the unique distinction of being laid off from two dot-coms in 49 days.

"I think I might have some honor here," admits Drake, who was let go from HomeGrocer.com in December and then online auction start-up Bidpath in early February.

Despite what many would see as bad luck, Drake doesn't seem too worried about the strange turn of events. She has spent recent days completing her tax forms, reading books, sewing and weeding the garden. But she has cut back on at least one favorite pastime.

"My first instinct was to go shopping. But then I thought I better conserve my severance," Drake says.

She is trying to remain upbeat, distancing her personal situation from what she reads in the newspaper.

"(Being laid off) is not the worst thing that has ever happened to me," she says. "Do I feel good enough to join another start-up? Maybe not. But I am not so burned that I would never again look at an Internet start-up."

Anyway, there are benefits to being laid off by two companies in less than two months. Unlike many dot-commers, Drake is comfortably sitting on two severance packages. She now jokes with friends that it would be a great time to be nine months' pregnant.

Drake says the layoffs were handled well at both firms. But being let go from HomeGrocer.com was harder because most people knew the cuts were coming six months in advance.

"It was hard to be in that limbo. That was kind of frustrating," says Drake, who was one of hundreds of HomeGrocer.com employees laid off after Webvan purchased the company in June.

At Bidpath, where she was one of about a dozen people to lose their jobs, there was no warning of the impending ax. When Drake arrived on a Monday afternoon last month to clean out her desk, she says she was treated well by executives. "There wasn't anyone standing over me as I boxed up my stuff. I was able to log on to my computer. It wasn't an icky feeling, let's just put it that way," she says.

Now that Drake is moving on, she is cautiously optimistic about the future.

"Check back with me in three months," Drake says. "If I don't have a job, this won't be a good thing."

Ken Weins
Sierra Online
Age: 48
Position: Software tester
Laid off: December

Finding work has not been easy for Ken Wiens, who lost his job at Bellevue computer game maker Sierra Online a week before Christmas in a companywide restructuring that affected 54 people. The father of two grown children, whose wife works in medical records at Overlake Hospital in Bellevue, has interviewed with half a dozen firms during the past four months with little luck.

Things seemed to be picking up last month when he received two calls from job placement agencies and had one lengthy interview with a local company. But he says nothing "concrete has come through yet."

"I turn 49 next month, and I am beginning to wonder if it makes a difference when (the employers) see the gray hairs," says Wiens, who is collecting unemployment and is coming to the end of his severance pay.

Getting laid off has brought out mixed emotions.

At times, the self-described poet says he feels like his 20-year-old son who works at Trader Joe's and is struggling to figure out his career path.

"You kind of feel useless, but then you think of all the different opportunities out there, too," he says.

While Wiens is a Microsoft Certified Professional and has spent more than 10 years in high-tech, he says he needs more skills to make it in the ever-changing technology world. He is especially interested in learning more about Visual Basic, one of the programming languages used in creating Windows applications.

So, on March 12, Wiens is going back to school through a government-supported program that pays for tuition, textbooks and certification tests. The five-month program at Bellevue Community College will retrain Wiens to become a network administrator with skills to maintain and oversee personal computer networks. It was not his first choice. But it is better than letting technology pass you by, he says.

Still, if Wiens was offered a job before the first class there is no question what he would do. "If something came up in the next two weeks, I would go for it," he says.

Kacey Hawker
Drivewire.com
Age: 38
Position: Office manager
Laid off: May

Undergoing back surgery is bad enough. Not having your company pay for it is downright frightening.

While Kacey Hawker only spent three months working in the Internet field, those 90 days have caused tremendous pain, emotional stress and financial setbacks.

Hawker's dot-com nightmare started a couple of months after joining Bellevue online automobile parts retailer drivewire.com.

Soon after being hired in March, Hawker was stricken with back pain and told by her doctors that surgery was necessary to repair a slipped disk.

A week before the back surgery, drivewire.com managers notified Hawker that she would be laid off for four weeks and recalled later in the summer.

What managers failed to tell her was that they had stopped paying her health insurance.

After a successful surgery, Hawker was planning to return to drivewire.com in August when on July 18 she received a letter from Premera/Blue Cross -- her health insurance company -- saying she was not covered at the time of the surgery. Facing a $25,000 medical bill and "financial devastation," Hawker panicked.

"That is when my world was rocked. I had to sit down. It was like the wind had been knocked out of me," she says.

Hawker later discovered that drivewire.com had not made health-care payments since April for her or her fellow employees. She also learned that Premera/Blue Cross pre-authorized the back surgery even though drivewire.com was past due on payments.

Hawker, who was never brought back to work at the struggling company, contacted a couple of lawyers but each wanted a significant retainer, something the unemployed single woman could not afford. She then turned to the Washington State Insurance Commissioner's office, which helped her sort out the mess and negotiate a deal with Premera/Blue Cross to pay part of the bill. Although she now owes $7,000 in medical fees, she is glad the ordeal is behind her.

Hawker returned to her original employer -- Bothell fitness equipment manufacturer Precor -- in August. She now says her short hop into the Internet world will be her "first and last" and the entire experience has left her feeling "kind of numb."

Jeff Coe
Docutouch
Age: 34
Position: Sales
Laid off: Feb. 5

Just a couple of months into his job at DocuTouch, salesman Jeff Coe knew the Seattle start-up was in trouble.

In December, the 3-year-old Internet company cut salaries by 10 percent, eliminated free parking and told staffers that the main service -- a digital signature technology -- was not gaining ground with customers.

"They were spending stupidly, spending $30,000 a month on airline advertisements before the (in-flight) movie," recalls Coe.

But it wasn't until the company shut its doors for two weeks around Christmas and asked employees not to show up for work that Coe, who just bought a house in Issaquah, saw the writing on the wall. He casually began searching for new work, spending hours on Internet job sites such as Monster.com. The job hunting process, however, took on added pressure in early February when Coe and 23 others were given pink slips and two-week severance packages.

The former salesman at RealNetworks and Xerox Corp. is stressed.

Most of Coe's personal savings went into remodeling his newly purchased house, including a $6,000 carpet. In addition to house payments, other bills are adding up.

His wife's salary as a teacher helps. But Coe quickly points out, "You know what teachers make." The couple also has a young child to support.

"What you have here is a highly motivated person who needs to find something now," Coe says.

The job-hunting process is somewhat clouded by thoughts of his past experiences at DocuTouch, his first time working at an Internet start-up.

"Here I am, a cocky, arrogant sales guy who is the eternal optimist," says Coe. "Being laid off does make you question your abilities."

Coe is not letting ego get in the way, however, and says that life goes on. He has met with several companies and has been called back for second and third interviews with a couple of firms.

Still, he says, "Until you get that job, it is certainly stressful."

J.P. Miller
Kindred
Age: 31
Position: Facilities purchasing manager
Laid off: Dec. 7

Dec. 7, 2000, is a day that will live in infamy for J.P. Miller.

OK. Maybe not that bad.

But the 31-year-old purchasing manager is still reeling from the bomb that was dropped on him and 11 other workers at Kindred Communications that day.

Called into one of the Internet consulting company's conference rooms, Miller was notified that his services were no longer needed at the Bellevue company. He was paid for 2 1/2 weeks of vacation, given a last paycheck and promised a week of severance pay.

Then, after a cordial meeting with the owners and a brief instruction session with the information systems director the following week, Miller packed up his gear and left.

Now, 2 1/2 months later, the Queen Anne resident is still waiting for the severance check to arrive.

"Last time I spoke to them, they said they were hoping to pay it before May," says Miller, who is collecting unemployment but says money is starting "to run a little low."

He is cutting back on expenses, going only to matinee movies and skipping restaurants.

"I am not going out to eat anymore. I am not buying any luxury items, and I pretty much walk everywhere," he says.

The job-search process has been slow with only one call from an employment agency in the past month and a half. That job, he says, was filled by the time he called back. A trip to last month's Pink Slip party at the I-Spy nightclub turned up few leads.

"It is kind of like nothing is safe," he says.

But, in one respect, Miller is lucky. About a half dozen of his buddies have been laid off from companies like Amazon.com, Nordstrom.com and HomeGrocer.com in the past six months, so he says, "At least I have a lot of company."

Peter Richards
Infospace
Age: 31
Position: Director of advertising technology
Laid off: Feb. 5

At 2:15 on Monday, Feb. 5, Peter Richards received an e-mail requesting his presence at the Bellevue DoubleTree Hotel fifteen minutes later.

Walking to the parking garage in the InfoSpace headquarters, Richards saw a group of security guards milling about. By the time he arrived at the hotel he knew he was losing his job.

"It was kind of like the gas chamber," says Richards, describing the mood at the hotel. "You walked in and signed your name. You knew what was coming."

Richards, one of the first 20 employees hired at the company, couldn't believe he was being laid off. He says he had positive job performance evaluations and was one of the few employees who understood the intricacies of the company's online advertising system.

Like the 20 or so other employees in the room, Richards was handed a severance package by the human resources director and then instructed to return to InfoSpace the following Saturday to retrieve personal items.

A total of 250 people lost their jobs in the layoff.

"It was a humbling experience. It was a slap in the face," says Richards, whose brother, also an executive at InfoSpace, filed a lawsuit against the company in December over a disputed stock option package.

Richards still believes his firing was retribution for his brother's lawsuit. He has hired a lawyer to explore his options.

An InfoSpace spokesman said the company does not discuss individual layoffs.

Meanwhile, the pink slip could not have come at a worse time. In addition to losing his salary, Richards forfeited stock options. His wife had a baby last week and a remodeling project at his home in southeast Bellevue is in jeopardy.

is it risky to take a health test? After a layoff

2009-03-27T12:17:00.000-07:00

Dear Annie: I lost my job in a restructuring in early 2008, and have spent most of the time since then training for a new career. I'm still covered by COBRA, so I have health insurance now, but that will expire in a couple of months, so I'll have to go get my own insurance. My family has a history of Huntington's Disease - my father, grandfather, and an uncle all had it or have it now - and I would like to get the genetic test that shows whether I have the defective gene that causes this terrible illness. Knowing one way or the other would help me plan better for things like how much retirement income I might need to cope with extra medical expenses, or how heavily to invest in long-term care insurance. Here's my question: If I get the test and it comes out positive, can insurers turn me down for medical insurance? -Just James

Dear James: Your question is certainly a timely one. Millions of people have already undergone genetic testing for a variety of hereditary conditions, including breast cancer, colon cancer, Huntington's Disease, and, in expectant moms, Down's Syndrome. Research on the human genome is speeding along and will make many more choices widely available before long, including genetic tests for heart disease and diabetes.

Last spring, without much fanfare, Congress passed a law called GINA (for Genetic Information Nondiscrimination Act), scheduled to go into effect this year, that's designed to help people in your position. It prohibits health insurers from:

Requesting or requiring that you (or a family member) take a genetic test.
Asking whether you have ever had genetic testing.
Requesting, requiring, or purchasing genetic information for underwriting purposes or prior to your enrollment in an insurance plan.
Using or disclosing genetic information for the purpose of deciding whether to insure you or for setting the premium you pay.

GINA also bans employers and labor unions from taking certain actions as a result of genetic information. For instance, if you did take a test for Huntington's and it turned up positive, an employer who somehow found out about it couldn't legally refuse to hire or promote you because of it, nor could they pay you less than they would if your test had come out differently.

An earlier law known as HIPAA (for Health Insurance Portability and Accountability Act), passed in 1996, already protected employees enrolled in group health plans from having their genes held against them. But HIPAA didn't specifically address the plight of people who are not covered by a group plan.

"GINA closes a gap that HIPAA left open. The people it will really help are those who have lost their jobs and must seek individual coverage," notes Joanne Hustead, a senior health compliance specialist at the Segal Company (www.segalco.com), an employee-benefits and human resources consulting firm. "Lots of people spend their careers going back and forth between group and individual insurance, with COBRA in between. For them, these are important protections."

Hustead adds that GINA also strengthens the genetic-information provisions of HIPAA for people in group plans. For example, the newer law prohibits insurers from raising premiums or contributions for a whole group based on genetic information about any member of the group. GINA also has teeth that HIPAA lacked: The newer law gives the U.S. Department of Labor the authority to impose fines on employers whose insurance plans violate the genetic confidentiality provisions of HIPAA or GINA. The fines can be as high as $100 per day for each participant in a group plan, which in a large company can quickly add up to a hefty sum.

For group policies, GINA starts to kick in at the start of any plan year beginning or renewing after May 21. (For a company whose insurance plan is on a July 1 enrollment year, for instance, GINA takes effect July 1, 2009.) For non-group policies, such as you will be getting when your COBRA runs out, GINA takes effect May 21 and applies to all individual policies - even those that were already purchased and in effect before May 21. You may want to get tested for the Huntington's gene on or after May 22, just to be absolutely sure that GINA covers you. Here's hoping your test results show you don't need GINA at all.

Job-Killing Recession Racks Up More Layoff Victims

2009-03-27T12:11:00.000-07:00

WASHINGTON — The recession is killing jobs at an alarming pace, with tens of thousands of new layoffs announced Monday by some of the biggest names in American business _ Pfizer, Caterpillar and Home Depot.

More pink slips, pay freezes and other hits are expected to slam workers in the months ahead as companies desperately look for ways to survive.

"We're just seeing the tip of the iceberg _ the big firms," said Rebecca Braeu, economist at John Hancock Financial Services. "There's certainly other firms beneath them that will lay off workers as quickly or even quicker."

Looking ahead, economists predicted a net loss of at least 2 million jobs _ possibly more _ this year even if President Barack Obama's $825 billion package of increased government spending and tax cuts is enacted. Last year, the economy lost a net 2.6 million jobs, the most since 1945, though the labor force has grown significantly since then.

The unemployment rate, now at a 16-year high of 7.2 percent, could hit 10 percent or higher later this year or early next year, under some analysts' projections.

Obama called on Congress Monday to speedily enact his recovery plan, warning that the nation can't afford "distractions" or "delays."

With the recession expected to drag on through much of this year, more damage will be inflicted on both companies and workers.

The mounting toll was visible Monday as roughly 40,000 more U.S. workers got the grim news.

Pharmaceutical giant Pfizer Inc., which is buying rival drugmaker Wyeth in a $68 billion deal, and Sprint Nextel Corp., the country's third-largest wireless provider, said they each will slash 8,000 jobs.

Home Depot Inc., the biggest home improvement retailer in the U.S., will get rid of 7,000 jobs, and General Motors Corp. said it will cut 2,000 jobs at plants in Michigan and Ohio because of slow sales.

"We are seeing no improvement in labor market conditions," said Sal Guatieri, senior economist at BMO Capital Markets Economics. "This year could be as bad as last year in terms of layoffs."

In response to deteriorating business conditions, Caterpillar Inc., the world's largest maker of mining and construction equipment, disclosed nearly 20,000 job cuts, most of which already have been made. They include 5,000 new layoffs of white collar workers, which will occur globally by the end of March.

Earlier actions included the elimination of 2,500 Caterpillar workers through a buyout offer announced in December, the termination of about 8,000 contract and temp agency workers, and the reduction of 4,000 full-time factory workers through firings and buyouts.

Texas Instruments Inc., which makes chips for cell phones and other gadgets, will cut 3,400 jobs due to slumping demand. The Dallas-based company said Monday it will slash 12 percent of its work force _ 1,800 jobs through layoffs and another 1,600 through voluntary retirements and departures. And Brooks Automation Inc. said it plans to get rid of 350 jobs, or 20 percent of its work force. It will be the second round of cuts for Brooks, which makes software and equipment for chip manufacturers.

Oilfield services provider Halliburton Co. said it will eliminate jobs in markets particularly hard hit by the recession, though it didn't provide details. Its larger rival Schlumberger Ltd. said last week it will cut up to 5,000 jobs worldwide in the first half of 2009 and consider further reductions this spring.

The flurry of layoffs comes on the heels of similar action by big-name companies just last week.

Microsoft Corp. said it will slash up to 5,000 jobs over the next 18 months. Intel Corp. said it will cut up to 6,000 manufacturing jobs. And United Airlines parent UAL Corp. said it would get rid of 1,000 jobs, on top of 1,500 axed late last year.

And there's no end in sight. In a survey by the National Association for Business Economics, 39 percent of forecasters predicted job reductions through attrition or "significant" layoffs over the next six months, up from 32 percent in the previous survey in October. Around 45 percent in the current survey anticipated no change in hiring plans. About 17 percent thought hiring would increase.

A new report by the placement firm Challenger, Gray & Christmas found that companies are often turning to a creative combination of measures to cut costs _ beyond layoffs. Those measures include pay freezes or reductions, forced vacations, travel cutbacks and the elimination of year-end bonuses.

"Many companies cannot cut their payrolls as deeply as they have in previous downturns, simply because they did not do as much hiring during the most recent expansion," said John Challenger, president of the firm. "As a result, they are forced to find alternative ways to keep costs down."

Not all the economic news was as grim Monday. Sales of previously owned homes and a separate barometer of economic activity each logged unexpected gains in December. But economists didn't view them as signs of improvement.

"Keep the party hats in boxes and the Champagne in the cellar," said Bernard Baumohl, chief global economist at the Economic Outlook Group. "It's one month's set of data and they tell us little about the future."

Economists said the uptick in home sales was due to sinking prices spurring buyers. In the other report, a government-influenced balloon in the nation's money supply largely affected the outcome.

Wall Street closed moderately higher. The Dow Jones industrials rose 38.47,or 0.48 percent, to 8,116.03, after briefly moving into negative territory.

The National Association of Realtors said sales of existing homes rose 6.5 percent to an annual rate of 4.74 million last month. Buyers took advantage of dramatically lower prices, especially in distressed states like California, Florida and Nevada, where foreclosures are soaring.

The nationwide median sales price sank to $175,400, down 15.3 percent from a year ago. That marked the biggest annual drop on records going back to 1968. The median is the middle point, where half the homes sell for more and half for less.

For all of last year, existing-home sales totaled 4.9 million, down more than 13 percent from the previous year, and the lowest since 1997.

Meanwhile, the Conference Board's monthly forecast of economic activity rose 0.3 percent in December. But that pickup was influenced mainly by federal efforts to ease the credit crisis, which caused the supply of money to expand. If the jump in the money supply were excluded, the board's index would have dropped sharply, economists said.

The national economy, meanwhile, is continuing to backslide.

Many analysts predict the economy will have contracted at a pace of 5.4 percent in the fourth quarter when the government releases that report Friday. If they are correct, that would mark the worst performance since a 6.4 percent drop in the first quarter of 1982. The economy is still contracting now _ at a pace of around 4 percent, according to some projections.

Steps to life after a layoff

2009-03-27T12:06:00.000-07:00

She didn't waste time. When Becky Johnson Sabin, a 37-year-old Sacramento communications manager, was laid off from her job with Teichert Construction in October, she decided to leap into whatever might come next in her career.

"I skipped denial and anger and went straight to acceptance and knowing something better was out there for me," Sabin says.

Really, how emotionally healthy. And what a good role model for other people who are frightened by the all-too-real possibility of losing their jobs in the current gloomy economic climate.

You know who you are: state workers and high-tech whiz kids alike; wage slaves as well as top-tier managers; the young who don't have much work experience and the old who worry they have too much. In the public and private sectors, in blue-collar work and white-collar jobs, at almost every level of the workforce, job security is nothing to take for granted these days.

Clearly, living through job loss has become a new lifestyle, albeit one that most people would never choose, since it brings with it alarming worst-case scenarios like losing both health benefits and home.

Still, there's a bit of good news.

"In the long run, there is life after layoff," says Davis career counselor Andrea Weiss.

And in the short run, layoffs don't carry the sting of stigma that they used to. In the worst economy in decades – with 2.5 million people laid off in 2008, according to the U.S. Bureau of Labor Statistics, and California's 9.3 percent unemployment rate the highest it's been in 15 years – how could they?

"How do you shift your thinking about your circumstances?" says Rayona Sharpnack, founder and president of the Bay Area's Institute for Women's Leadership. "This is an opportunity to rethink your identity. Most people consider their identity to be what they do instead of who they are.

"What we can control when everything's out of control is how we hold our circumstances."

Facing potential layoffs, you've braced for impact – but maybe you should embrace the possibility of reinvention instead.

Which brings us back to Becky Johnson Sabin, who powered from unemployment to a new job as communications director for Siemens Mobility in an impressive five weeks' time.

"I sent an e-mail to one of my old bosses at Teichert." she says. "I said, 'Thank you for letting me go. It forced me to do something different.' I think it's the only time anyone's ever thanked him for getting laid off."

The nuts and bolts of it

A few practical suggestions on how to survive job loss:

If you think you might be laid off, Nancy Collamer, a Connecticut-based career counselor and author of the e-book "The Layoff Survival Guide," says you should make sure you've already taken home copies of your performance reviews as well as your contact information list, which will be the backbone of a new job search.

"Those things are just good career management," she says.

The day of the layoff, she says, don't get angry at your managers, and don't sign anything.

"I'd ask for 48 to 72 hours to review the paperwork," she says. "Sometimes, employers try to get you to sign a release in exchange for your severance. You're not thinking clearly. Don't sign anything then and there."

Remember that getting laid off isn't personal, suggests Sabin.

"It's just numbers," she says.

So why do so many employers insist on having security escort laid-off workers from the building immediately?

"Some of them are concerned about sabotage," says Collamer. "The more common reason is that they're concerned about what those people will say and do in the office.

"Being escorted from the office leaves people feeling like they've done something criminal. But you have to recognize that it can and does happen."

In the first three days after a layoff, your job is to review your separation package, make sure your spouse and kids are aware of the situation, e-mail your contacts and file for unemployment.

And breathe.

Many career counselors, including Weiss and Collamer, think it's a good idea to take a week or two to mourn what you've lost.

"You go through a grieving process," says Weiss. "You won't be seeing your quote-unquote family that you've spent eight hours a day with for years.

"There's some mental health management that people can do to acknowledge their feelings of being upset, depressed and angry. Stress management is key – getting enough sleep, exercising and blowing off steam."

On the other hand, Sabin started interviewing only two days after her layoff.

"It was a great ego boost to me," she says. "I took it as a good sign that I really am marketable.

"People asked me if I was going to take time to relax. I'll relax when I've earned vacation time. I wasn't getting paid to relax."

If your previous employer offers outplacement services, make good use of the chance to polish your résumé and brush up your interviewing skills.

"People blow that off because they're upset," says Weiss. "But I strongly encourage people to take advantage of it."

Structure the job search

And so to the job search. Sabin says she got up every day, put on good clothes and treated looking for work like a full-time job. Not a bad idea, say the professionals.

"Statistically, very few people find jobs through online job boards," says Collamer. "You have to network and work the system. You've got to put yourself out there. You have to set up a schedule and surround yourself with support.

"The people who are most successful at this put structure into their job search and take steps every day to maintain their emotional well-being."

Not everyone is lucky enough to find work quickly. When Collamer's husband was laid off in 2001 from his high-tech job, his job search took a year. Frustrating, yes. But Collamer says she and her husband now treasure their memories of his time at home with the family.

Says Collamer: "I personally think volunteering is one of the best things you can do when you're laid off. It gives you perspective on your situation and the opportunity to be of value.

"I say to people, 'Don't stop living. There's no reason.' "

3 Keys for Speeding Up Re-Employment - Life After Layoff:

2009-03-27T11:59:00.000-07:00

What happened? One day you were working and the next day you were ushered out with a pink slip. What do you do now? Does looking for another position in today's economy overwhelm you? What can you do to ensure future job security?

For a company undergoing restructuring, a layoff is like pruning a tree to stimulate its growth. For you, the downsized employee, a layoff is an involuntary life-altering event. How you cope with it will impact your future employment experiences. Even if you are lucky to get outplacement services, mastery of certain core competencies is a must. To boost layoff recovery, become an expert in the key actions of Connect, Clarify and Commit. To get ahead of the curve, hire an expert like a Career Coach to personally guide you.

Connection

Connection consists of: 1) connecting with yourself, 2) connecting with a career support team, and, of course, 3) connecting with hiring authorities. Let's briefly explore these action steps.

A layoff can be a traumatic experience - in many ways similar to a loved one's death or perhaps a divorce. It is critical to get in touch with your feelings. Let yourself experience the stages of grief (including the pain) as so aptly explained by Elizabeth Kubler-Ross in her book, "On Death and Dying." These stages include shock, denial, anger, bargaining, depression and acceptance. Although you may feel emotions sparked by these stages at any time during the layoff healing process, most individuals will need to go through all six stages to achieve a healthy perspective about re-entering the workplace.

Recovering from layoff shock can be a lonely process, so assemble a career support team to act as your personal advisory board. This team should include your Career Coach, a trusted and qualified professional who will support your efforts to discover where you can improve, what you want to change, and how to optimize your job search for re-employment success. Who else belongs on this team? Family, friends and colleagues…some, perhaps, experiencing a layoff, too. A note of caution: the purpose of a support team is one of positive energy and forward movement, not an ongoing "pity party" - so choose your support team members wisely!

As you move forward, hiring authorities will become your connection focus. Interviews, and how to get them, will become your main goal. This is where preparation becomes critical. Know your work history inside out. Develop an articulate way to verbalize your accomplishments and how they added value to your past employer's bottom line. Practice your personal "unique selling proposition" or 30-second commercial to use in networking situations, telephone interviews and face-to-face meetings. Role-play interview situations with your Career Coach to acquire a comfort-level in telling your "stories" to potential employers.

Clarification

What must be clarified as part of your reemployment process? A layoff offers you time to examine your career history, career path and career goals. Are your values in alignment with your career? Values may be personal, spiritual or professional in nature. If they are out of sync, career satisfaction will elude you. A lot has been said recently about values, or lack of, in the workplace. Only when your values mesh with your company's culture will you be happy. Only when you find a way to work your passion will you jump out of bed in the morning with an "I can't wait to get to work" attitude.

Not only review your values, but also evaluate your skills and interests. With assistance from a Career Coach, access assessments to explore possible shifts in your career direction. Don't assume that just because you have worked in the same industry for the past 10 or 15 years you are stuck there. (Career Coach note: I left a 12-year career to begin another in the career management field where I have been working my passion for the past 17 years.)

Examine your educational background…what would you have to do to brush up on stale skills or retrain for a new field? What interests do you have that could be transformed into a rewarding career? Let curiosity, not fear, motivate your exploration. We live in an ever-changing world where companies struggle to maintain profitability. They seek employees who embrace change and drive innovation. We're never too old to learn new things. In fact, learning is a lifelong process. What knowledge areas do you want to expand? How can you lead the cutting-edge of innovation? (Career Coach note: Is now the right time to explore starting your own business?)

Discover where your career values, interests and skills merge, then filter them through business reality…the final clarification prior to launching a career change. Now, and only now, are you ready to write your resume. Your resume must be PERFECT! It will be your primary marketing tool used to get interviews. It will be your brochure, your calling card; it will make your first impression for you. Even if you are a good writer, you may be too close to your own situation to do justice to your resume. Hire a professional resume writer who knows how to position you on paper.

Commitment

Finally, create your action plan and commit to working it. Research companies and job leads, network in professional circles (85% of all positions are secured through networking), develop a system for posting to the job boards and track your results, and use your Career Coach to keep you on course. Now is NOT the time to take a vacation!

Maintain a positive attitude by accepting the past as past; learn from it and let it go! Realize that the job search process in a numbers game…you will have to collect your set of "no's" to get a "yes." Above all else, be true to yourself. Don't accept just any job offer or you will be searching again soon, a victim of the "rebound" syndrome. Remember, job security comes from within you. No one owes you a job…you've learned that lesson, right? Develop a "brand me" approach to your career with you as your own most important product. Then, success will become yours!

February 2009 Month Layoffs

2009-03-27T11:45:00.000-07:00

February picked up right where January left off on the layoff front. At the time, we were astonished by the 1,540 laid off during the month - that was more than triple the two preceding months. This month, almost twice as many again have been fired. 2,708 people were fired from major law firms in February (1,104 lawyers, 1,604 staff), compared to 1,540 in January (694 attorneys, 846 staff).

Law firm layoffs have permeated the highest levels of firms and the cuts are getting deeper. Latham & Watkins, DLA Piper, and Allen & Overy not only rank in the top half of the Vault 100, but they were among the firms laying off the largest numbers. Trimming 10% of headcount is becoming de rigeur.

Data and analysis after the jump.

The first noteworthy trend is the aggressive stance the Magic Circle and other UK firms have taken in cutting attorneys. UK firms laid off 471 attorneys out of 916 total, which meant attorneys constituted just over 51% of the headcount.

In the US, however, it was 633 attorneys out of 1,756, or just 36%. Staff are being laid off in the US almost twice as frequently as attorneys. Within the US, California firms laid off 235 attorneys, but only 56 came from New York firms this month.

Tech Layoffs Surge to 300,000 - August 2008 to March 2009

2009-03-27T11:31:00.000-07:00

Layoffs in the tech sector are accelerating. It took exactly three weeks for tech layoffs to surge to 300,000, according to our Layoff Tracker. Since late January, when the tracker hit 200,000 layoffs, another 100,000 job eliminations have been announced or completed. In contrast, it took five weeks for layoffs in the tech industry to hit the 200,000 mark, and four months for layoffs to hit 100,000 last December. The total number of layoffs since we began tracking since the financial crisis began in late August is 300,093.

The past few weeks have particularly brutal for the technology space, with substantial layoffs announced by Pioneer (10,000), Cisco (3,000), Panasonic (15,000), NEC (20,000), Electronic Arts (1100) and AOL (700). Even Bloomberg and The Wall Street Journal, who both managed to avoid layoffs in the past few months, were forced to make cuts to their workforces. And Google, who was immune to layoffs until late January, continued giving pink-slips in the past three weeks with the company’s exit from radio. Sadly, a few start-ups weren’t able to weather the storm, with eBaum’s World cutting all of its workforce.

Obviously the tech industry is not immune to the current economic climate, and if the past three weeks are any indication, things could still get worse for the tech space before they get better. Maybe that economic stimulus plan will help turn the tide.

Job Losses During Recessions - Chart

2009-03-23T08:51:00.000-07:00

Barry Ritholtz provides us with the following chart: Job Losses in Post WWII Recessions

Click on graph for larger image in new window.

This graph shows job losses during recessions from the peak month of employment until jobs recover.

The current recession has had the most job losses and the 2001 recession had the weakest job recovery.

However this graph is not normalized for increases in the work force.

The second graph (that Barry asked me for) shows the job losses from the start of the employment recession, in percentage terms (as opposed to the number of jobs lost).

For the current recession, employment peaked in December 2007, and this recession is about as bad as the 1981 recession in percentage terms at this point.

In the earlier post-war recessions, there were huge swings in manufacturing employment. Now manufacturing is a much smaller percentage of the economy, and the swings aren't as significant because of technological advances. This is the main reason that job losses were larger in those earlier recessions.

Here is Barry's updated post (with another graph). Barry asks: Are recessions taking longer to recover from? The answer appears to be yes. And I expect unemployment to be elevated for some time (even after the economy starts to recover).

The Job Loss Unemployment Syndrome

2009-03-23T08:47:00.000-07:00

THE message from reports from the ground is clear. Unemployment in India's industrial and services sectors is on the rise. If earlier growth was being described as ''jobless'', the problem now is that growth that is lower comes with job losses. The recessionary impact that the global financial and economic crisis has had is resulting in huge job losses in various segments of the labour market. However, a reliable aggregate estimate of the extent of increase in unemployment is not available from the official statistical system. Recognising that unemployment is on the rise, the government did make an attempt to estimate the impact of the downturn on employment. On its request, the Labour Bureau conducted a sample survey covering eight sectors (mining, textile & textile garments, metals & metal products, automobile, gems & jewellery, construction, transport and the IT/BPO industry) to arrive at an estimate of job loss. The survey was designed to cover a sample of units employing 10 or more workers, with the sample being drawn from 20 centres in 11 states and union territories.

Finally, 2581 units were covered, of which 1168 were from the textile & garments industry, 752 from metals & metal products, 242 from information technology & business process outsourcing, 132 from automobiles, 104 from gems & jewellery, 103 from transportation, 19 from mining, and 61 from construction. Based on this limited sample, the total employment in all the sectors covered by the survey is estimated to have declined from 16.2 million during September 2008 to 15.7 million during December 2008, implying a job loss of about half a million (Table 1). Given the coverage and methodology of the survey, few believe that this is an acceptable estimate. The actual decline in employment during this period is likely to have been much higher. Moreover, the decline is likely to have occurred over a much longer period.

However, the survey does suggest that employment fell in every month during the period studied. After September 2008 employment in all industries declined at an average rate of 1.01 per cent per month. A comparison of employment in export and non-export units indicates that employment declined at an average monthly rate of 1.13 per cent in the case of the former, as opposed to 0.81 per cent in the latter (Table 2), pointing to the direct role of the global slowdown.

Table 1: Trends in Average Employment, India (million)
Period	Average Employment	%age change
September,08	16.2
October,08	16	-1.21
November,08	15.9	-0.74
December,08	15.7	-1.12
Average Monthly change		-1.01
Source: Labour Bureau, Ministry of Labour and Employment

Table 2: Percentage change in Employment of Exporting and Non-Exporting units
Period	Exporting Units	Non- Exporting Units	Overall
October,08	-1.3	-1.05	-1.21
November,08	-0.45	-1.24	-0.74
December,08	-1.66	-0.15	-1.12
Average Monthly change	-1.13	-0.81	-1.01
Source: Labour Bureau, Ministry of Labour and Employment

ONLY WHITE COLLAR

JOBS IN FOCUS

With aggregate data being limited, the assessment of and response to rising unemployment has been driven by episodic evidence of job loss highlighted by the media. However, given the nature of India's boom and the pattern of recent growth it is the loss of white collar jobs that garners attention from the media. This was evident when Jet Airways, beleaguered by high oil prices, increased competition and falling demand, laid off around a thousand employees. The response to the announcement was so adverse that the company was forced to go back on its decision and focus instead on restructuring its operations and obtaining concessions from the government to reduce its losses.

Similarly, other labour market developments that have received and are receiving media attention are evidence of sluggishness in on-campus recruitment from elite institutions like the IITs and IIMs, lay-offs and redundancies in software services and business process outsourcing firms and evidence of job losses in the Gulf countries. Much less attention has been paid to job losses of informally employed blue collar workers in the organised sector or those dependent on wage- or self-employment in unorganised manufacturing, services and agriculture.

The attention devoted to white collar jobs in select sectors is partly understandable, given that the crisis originated in and affected most of all the financial sector in the source countries. Moreover, even in India the crisis hit the financial sector first, being transmitted through the exodus of foreign financial capital that withdrew from the country in order to meet commitments or cover losses incurred by these firms in the source countries. This impacted immediately on white collar workers employed in the financial sector. Predictably, the crisis in the developed countries also affected workers in the software and IT-enabled Services (ITeS) sector, because the crisis-afflicted financial industry in the developed countries was an important outsourcer of business to India. Software and ITeS, which were among the fastest growing exports, were also likely to be the most affected in the wake of a developed country downturn. Here too the victims of job losses were sections considered part of the white collar elite.

IMPACT OF

THE CRISIS

However, there were more routes than these through which the crisis was transmitted to India. One, for example, was the direct impact of the global trade slowdown on traditional export industries like textiles and garments, gems and jewellery, leather and carpets. According to the IMF, the growth of exports from emerging and developing economies is likely to fall from a positive 9.6 per cent in 2007 and 5.6 per cent in 2008 to a negative 0.8 per cent in 2009. It is small recompense that the rate of growth is projected to rebound sharply in 2010. Such projections are suspect, since the IMF has made it a habit of putting out optimistic projections and then revising them downwards. In fact, the 2009 slump could prove sharper than currently predicted. With traditional exports still dominating India's manufactured exports, these industries were bound to be affected most, as is clearly true in Surat's diamond cutting industry where low wage workers cater to the world market for an expensive luxury.

Besides this, the recession is bound to affect demand, capacity utilisation and employment in a wide range of manufacturing industries catering to the domestic market. Moreover, growth in a number of areas such as the housing sector, automobiles and consumer durables had been driven by credit-financed purchases encouraged by easy liquidity and low interest rates. The curtailment of credit provision by a damaged or cautious financial sector would further reduce demand, increase inventories and lead to job losses in industries directly or indirectly catering to such credit-financed investment and consumption. Influenced by these trends and the second-order of effects of contraction in these areas on demand for other manufacturing sectors, there will be a wider range of industries and segments of the labour market that will be affected by the ongoing crisis.

Finally, as a result of all these developments, the demand for agricultural commodities and the viability of crop production is being increasingly eroded. But with the government confident that the National Rural Employment Guarantee Scheme (NREGS) has generated additional employment in rural areas, the impact that the crisis is having on employment in agriculture and non-agriculture in the rural areas is being underplayed. The budget estimates that the NREGS delivered 13.88 million person days of additional employment in 2008-09. But this employment in public works, which definitely needs to be celebrated and expanded, need not have fully or even substantially neutralised the loss of routine or regular employment in rural India, however limited or underpaid such employment is. The NREGS is a demand-driven scheme and the sharp increase in employment generated through the scheme need not only be because the previously unemployed opted for it, but because those losing jobs are turning to it as an alternative. If so, the urgency of increasing allocations substantially is obvious.

GOVT’S LACK

OF URGENCY

Overall, therefore, the unfolding crisis is resulting in significant job losses across the country. What is surprising, however, is the lack of any sense of urgency on the part of the government in the face of this crisis. In fact, the initial response was that since the Indian financial sector was not significantly exposed to the sub-prime mortgage crisis and the toxic assets associated with it, the crisis would not impact India. Subsequently, while it was accepted that India was indeed being affected, the perception seemed to be that this effect was largely because of the liquidity squeeze and credit decline that resulted from the exodus of foreign capital from the stock market. The government's response was thus focused on increasing liquidity in the system and reducing interest rates. The first sign of the government's recognition that there was a slump in demand that needed direct action came only in December 2008. Unfortunately, the resulting response was limited, so that the economy and employment are still slipping.

Yet, even as recently as at the time of the presentation of the interim budget in mid-February, the government seemed to be complacent. Pranab Mukherjee's budget speech referred to the effect of the crisis as follows: ''A crisis of such magnitude in developed countries is bound to have an impact around the world. Most emerging market economies have slowed down significantly. India too has been affected. For the first nine months of the current year, the growth rate of exports has come down to 17.1 per cent. According to the latest figures available, the industrial production has fallen by 2 per cent year-on-year basis in December 2008. In these difficult times, when most economies are struggling to stay afloat, a healthy 7.1 per cent rate of GDP growth still makes India the second fastest growing economy in the world.'' In sum, the view seems to be, we are not untouched but are faring relatively well all the same.

A consequence of such complacence is that the interim budget chose to avoid taking any further steps of significance to counter the crisis. Such a state of denial is possible only because public resentment at the effects of the crisis is just building up and the government is not under pressure to address the crisis seriously. Despite such an explanation, the attitude of the UPA government is puzzling. With an election nearing and an economic crisis offering the justification and therefore an opportunity to the government to spend its way to victory, it is surprising that the State is still seized by fiscal conservatism.

IN A STATE OF

DISCONNECT

There could be two explanations for this. The first could be that the Congress party is actually in a state of disconnect, having lost its links with the grass roots and increasingly unconscious of developments on the ground. With the party having to depend on the prestige of one family and its scions to garner it votes this is not unlikely. The situation may be worsened by media that are disconnected and focused merely on the stock markets and India's attractiveness to foreign capital. In the event, the party and UPA government may not even be cognizing the dimensions of the unfolding crisis. Unfortunately for it, there is no organised, vocal force at the moment strong enough to make it recognise reality. This could mean that a voiceless electorate may be forced to respond in the coming elections with a mandate that treats the ''Bharat Nirman'' slogan of the current UPA government with the same contempt it gave its predecessor's ''India Shining'' campaign.

The second explanation could be that the levers of the Congress have been seized by fiscally conservative neo-liberal economic ideologues and cynical political satraps, neither of whom have an inkling of either the current electoral strength of the Congress or of what needs to be done to win the forthcoming elections. It is possible that long years of destruction of the mass mobilisation infrastructure of the party may have denuded it of those who can forcefully make the case for alternative policies that can meet the aspirations of a beleaguered electorate. In the event, the fiscal conservatives and neo-liberals may have come to dominate the economic discourse, making a case for reversing the foreign capital drain through more liberalisation and offering concessions to private capital, rather than creating the domestic political space for a national revival and rejuvenation plan.

In either case the loss is national, since there are no Left allies to force the hands of the Congress. This was what happened in the case of the rural employment guarantee scheme, which is now being touted as a flagship scheme that has helped India beat the recession and praised even by those who had bitterly opposed it earlier. Without some pressure for more such policies, job losses will continue, attributed by industry to ''attrition'' and cynical analysts to the inevitable downsizing needed to enhance competitiveness. It is possible that once again a surprise mandate may force a course correction, but that mandate is more than three months away. The intervening period can be one where the economy and mass livelihoods suffer damage of a kind that can take too long to repair.

IT will generate 10 mn jobs by 2010 in India

2009-03-18T11:09:00.000-07:00

India 2010

The IT and BPO industry will generate ten million jobs by 2010 in India and the country will become the ‘centre of gravity’ in the world for the sector, says Nandan Nilkani, CEO of the Nasdaq-listed Infosys.

Talking to a group of editors on the ‘Business Implications of a Flattening World’, he said the Indian companies will have to have a global vision to realise the potential of the country becoming the centre of gravity in the information technology sector.

Nilekani said software development in India has become qualitatively better and customers wanted more of it. The global companies have to make a fundamental shift in their strategies by opening up more to markets in India and China.

Citing an example, he said in these two countries a huge demand for things like mobile phones was growing and other countries have changed their operations from BPO to leverage this aspect.

How to soften the job loss blow

2009-03-18T11:08:00.000-07:00

Software firm Mastek's decision to give 425 of its employees the option to resign, or to stay with the company at a nominal compensation and receive training shows that giving workers the boot isn't the only way businesses can reduce costs.

None of the 425 employees will accept the option with big smiles, but chances are that they would understand the management's compulsions and probably be grateful to the company for this gesture. For it was easy for the company to issue pink slips as almost half of these employees are trainees who had joined in July, 2008 or later.

It's obvious that Mastek, which expects about 80 per cent of the 425 employees to stay with the company, will be able to reap dividends that go far beyond simply avoiding reprisals. Gestures such as these go a long way in sending a morale-boosting message to those who survive layoffs.

Mastek's compulsions are understandable as it has slashed its revenue growth target for the year-ending June 2009, saying it expects hits from a continued slowdown in demand and an adverse foreign exchange environment.

HR experts say this shows the increasing maturity of Indian employers in handling potentially-messy situations in a country where layoffs are still frowned upon. Many other companies are also pitching in to make sure the retrenchment process can be as painless as possible. The idea is to hand-hold these employees while helping them to get jobs, so that they can walk out of the door with their head still held high.

Software giant Cisco was the first to show the way in 2001, after the tech bubble burst. The company allowed employees to take sabbaticals while they were paid one-third their salary.

During that time, they received employee benefits, vesting and access to training and continuing education. If jobs opened up, these employees enjoyed an advantage over external candidates. If their sabbaticals ended without placement in another Cisco job, they remained on Cisco's rolls for an additional 60 days while job hunting.

Some left; others didn't, but Cisco saved money, talent and - more importantly - its reputation as an employer of choice. So when Cisco rode the technology boom again, it had enough people wanting to come back again.

Swedish Postal Services, Posten, for instance, launched a Futurum Programme for outplacement with the objective that all participants in Futurum must have a new job within 18 months and 70 per cent of the participants must have a new job within 10 months. The professional support helped restructure operations quickly.

In India, Motorola relied on outplacement (helping employees find jobs elsewhere) in 2006 when it closed down one division and wanted to reduce its employee strength by 150. A job fair was held on Motorola's campus with representatives from other companies and recruiters. Those who cleared the interviews were placed with other firms.

Tata Consultancy Services [Get Quote] gives non-performers an opportunity to raise performance levels through additional training and consistent mentoring over the next 12 months. It also sends resumes and contact details of these employees to its external placement partners to help outplace the employees.

Infosys [Get Quote] gives rigorous training to employees who have been found wanting. If things don't work out still, the company gives them almost a year to find another job. Almost all them get jobs.

ICICI Bank [Get Quote] too makes sure that those who fail to make the grade in appraisals are not out on the street immediately. The bank gives them enough time, feedback and additional training before taking the hard decision. In most cases, the bank's rigorous selection and training ensures that most of these people get jobs soon enough.

There are generally three parts to such outplacement actions: Emotional counselling, financial counselling and career counselling. Though the concept is relatively new to India, the findings of independent surveys in countries where it's been in vogue for a while will remove any doubt over whether employers should care when so many layoffs are predicted.

For example, a survey done by Reed in the UK found 66 per cent of top managers saying outplacement support improves staff morale, motivation and productivity during times of change. A whopping 87 per cent believed that offering outplacement eased the pressure on line managers.

While no outplacement company can guarantee jobs for all its candidates, it helps turn the redundancy process into a positive move forward for the individual, and helps the company's reputation as an employer - good enough reasons for many companies to include outplacement services in executive severance packages.

For employers, outplacement is a small price to pay for helping people to find jobs. After all, losing a job ranks fifth in life's most traumatic events and occupies an undisputed first place in work-related trauma.

Will Job loss rates reduce by Easter?

2009-03-18T11:07:00.000-07:00

The Chartered Institute of Personnel and Development (CIPD) have suggested that the worst of the UK’s current job losses will be over by Easter 2009.

Research carried out by the CIPD indicated that unemployment trends in the UK followed the US, suggesting that the rate of job losses will decrease as American firms planning to cut jobs has “fallen from one in three to one in five”.

10 ways SMBs can cut costs (relatively painlessly) in a slow economy

2009-03-13T13:00:00.002-07:00

Whether your business is doing well or taking a hit on the revenue side, just about everyone is seeing their costs of doing business go up. Even small and midsize companies whose sales and income have increased are being forced to tighten their budgets to deal with soaring expenses due to fuel and energy prices, higher taxes, and other outlays over which they have little or no control.

Luckily, there are other areas where you may be paying more than you have to, so you can cut your costs to keep your organization’s financial status on an even keel. Many of these changes don’t require a big sacrifice — and you might find yourself getting more while paying less.

Earlier this year, I addressed how IT departments can cut costs in 10 Ways to Trim your IT budget. But many small companies don’t even have an official IT department. If that’s the case, you can still benefit from the advice in that article — but we’re going to show you how to go beyond those suggestions.

Note: This information is also available as a PDF download.

#1: Cut the landline

Traditional telephone service in most areas costs substantially more than voice over IP, even if you only make a few local calls. If your company does a lot of domestic long distance and/or international calling, you might be able to save a bundle by dropping the landline in favor of VoIP. For instance, one small business in our area was paying $43/month per line for a basic landline from AT&T with no voicemail or other advanced features. Long distance calls were extra, resulting in an average monthly bill of more than $200 each month for two lines.

Switching to Lingo Business VoIP, they were able to keep the same phone number, and they got two lines for $49.95 with no extra charges for calls anywhere in the United States and 22 other countries. They also get features such as voicemail delivered via e-mail, call waiting, simultaneous ring, and other options they didn’t have with the landline. Other VoIP providers have similar plans.

Before you give up the landline, be sure it’s not needed for other purposes, such as your fax machine or security alarm monitoring system, and be aware of the emergency calling (9-1-1) implications.

#2: Ditch the fax machine

Some older fax machines won’t work on a VoIP line, although many modern machines will. However, whether or not you have VoIP, you may be able to save money by doing away with the fax machine altogether. Sending a fax over a landline often incurs long distance charges, and receiving faxes uses paper and printer ink.

Most documents that are faxed can be sent more cost effectively and just as easily as e-mail attachments. If the original document was created electronically, attaching it to an e-mail message is a simple click-click operation. If not, you can scan it and send it.

Some people with whom you do business may insist on a fax instead of e-mail. Recently, a Merrill Lynch advisor refused to accept a form via e-mail because it contained personal information, even though I offered to encrypt it. However, I was able to send it using a free Web faxing service called FaxZero. The catch? They put an ad on the cover sheet. If you prefer not to have the ad, you can pay $1.99 to send the fax. If you send only a few faxes a year, this makes more since than maintaining a fax machine.

If you have people who insist on sending you faxes rather than e-mail attachments, you still don’t have to deal with the expense of a landline, fax machine, paper, and ink. There are low-cost Web-based services for incoming faxes, such as Packetel that allow you to get a fax number and receive incoming faxes for $3.95 per month.

#3: Reconsider physical security options

Physical security for your business is important, regardless of its size. But some small and midsize companies are paying more than they need to for physical security because they haven’t considered modern options. If you’re still relying on the traditional security guard on the premises to protect the property at night when you leave, you might want to look into new technological solutions, such as IP-based surveillance cameras you can monitor from home or have monitored by a service at much lower cost than the salary of a guard.

You may also be able to save money on alarm system monitoring by switching to a monitoring company that supports VoIP or that uses a dedicated cellular uplink instead of a landline for communications between the alarm system and the monitoring station. It also pays to shop around and carefully read all the details of alarm monitoring contracts, since many of them lock you into a contract that automatically renews for a multi-year period if you don’t cancel at precisely the right time — which means you could end up paying for years of service you don’t use if you need to move or want to switch companies.

Invest in good locks, fencing, security lighting, etc., but don’t let security companies use fear tactics to talk you into buying expensive sophisticated security equipment and services that are overkill for your level of risk.

#4: Use snail mail only when absolutely necessary

Postage keeps going up, even as the quality of service we get from the post office seems to keep going down. Many business people have learned the hard way that they end up paying extra when bills that were mailed on time take weeks or even months to get to their destinations across town, so they pay even more to use certified mail or priority mail that can be tracked. At $4.80 to send one regular size envelope domestically, the costs can add up fast.

You can save money by paying bills online when possible; this also saves money you pay for checks and makes it less likely that you’ll incur late fees. You can also save by sending documents, especially large ones, as e-mail attachments, making them available for download from an FTP server or using other electronic file-sharing applications to send them.

#5: Go (at least partially) paperless

Paper and ink cartridges cost money, and the more you use your printers, the more quickly they’ll wear out and require replacement. Printers also use power. With the rising cost of energy, you can save money on electricity bills by cutting down on the amount of material you print.

Consider how you can convert your workflow to an electronic one by eliminating unnecessary hard copies wherever possible. If you print and send a monthly newsletter to your clients, for example, consider instead sending it via e-mail or posting it on your Web site. Advertise your products and services on your Web site instead of printing flyers. Send internal memos electronically rather than distributing printed copies. Read documents and e-mail messages on the computer screen instead of printing them out.

#6: Recycle within the organization

Families on a budget have always saved money by passing on hand-me-down clothing, shoes, and toys from one child to another. Businesses can do the same by recycling office equipment, furniture, and supplies from one employee to another. If your company’s engineer needs a more powerful computer to run the latest number crunching software, the old system may be perfectly adequate for a clerk who only uses e-mail and word processing applications. Always look at how assets can be recycled within the company before throwing them away.

If you really have no more use for electronic equipment, many localities won’t allow you to simply throw it in the trash — you have to pay to have it hauled away. Instead, you may be able to donate it to a charitable organization and save the cost of disposal while at the same time possibly getting a tax deduction. Just be sure to keep security in mind and remove or completely erase hard drives on any computers you give away.

#7: Cut travel costs

If travel is an important part of your business model, you know that costs are way up. Airlines are raising fares, tacking on new fees, and charging extra for things that used to be free, like checked baggage and nonalcoholic drinks. Choosing to drive instead means paying gasoline prices that have almost doubled in the past year. There are also hidden costs involved in traveling — like that $852 cell phone bill for international roaming that we got after a recent business trip.

You can still reduce travel expenses by careful planning. Of course, the most effective solution is to travel less. With videoconferencing technology, you get the next best thing to being there without the cost or the hassle. You don’t need expensive enterprise-level “telepresence” equipment to conduct effective remote meetings.

If you must travel, use technology to get the best prices possible. Many travel agents now charge booking fees. You might save by booking your own flights and hotels. Do some research and find out the most cost-effective way to do it. Some airlines charge a higher fee for making reservations online, while others charge more to make phone reservations. Sign up for frequent flyer miles — and use them. Use a company credit card that gives you miles or cash back. Don’t pay for extras you don’t need (such as rental car insurance when your company or personal policy, or your credit card, already covers you).

The key to getting the best travel deal is often doing the research. You should try alternate airports (and alternate days/times if you have some flexibility in your travel plan). Booking directly from a hotel’s Web site will often get you deals you might not get through the travel sites.

#8: Embrace telecommuting

If your small business is outgrowing your physical space, one way to save money may be to allow select employees to telecommute instead of investing in more office space. With new technologies, it’s not only easier but more secure than it once was to let workers log onto the company network from home. Having fewer people working at the office can also save money on your energy bills. One option is to shut down the office completely one day per week and have everyone work from home, so that you can also shut down the heating or cooling system.

Telecommuting costs less for the employees themselves, too. Not only do they save money on gasoline (a savings that is becoming more and more significant as gas prices rise), but they may also save on the cost of clothes, lunches, and other incidental costs associated with working in an office environment. And they also save the time that it would take to drive to and from work — which can be as much as two or more hours per day. Because telecommuting has so many advantages for workers, they may accept a lower salary, in turn saving your company more money.

#9: Partner up

Small businesses may not be able to buy office supplies and other items in bulk to take advantage of volume discounts, but by partnering with other small businesses in a co-op purchasing plan, you can all save money. You may also be able to form an association with other businesses to get better prices on things like employee health insurance or even consulting services.

#10: Go green

“Green” is the new buzzword, and many businesses are now making efforts to operate in a way that’s more environmentally friendly, either voluntarily, out of the desire to be good community citizens, or under government mandates. The good news is that many of the measures you can take to help the planet also save you money. For instance, using Energy Star rated electronic devices and turning off electrical devices when they aren’t in use can save you a substantial amount of money. Similarly, reducing paper consumption to save the trees also has a positive impact on your bottom line.

Other environmentally friendly money saving tips include upgrading the cooling systems in your facilities and using programmable thermostats to automatically adjust temperatures when the office is empty, using smaller and more fuel-efficient company cars, replacing bottled water in the office with a water filter, using energy-efficient light bulbs, replacing old CRT monitors with flat panels, and even replacing desktops with laptops, which use considerably less energy.

How to cut costs without firing staff

2009-03-13T13:00:00.001-07:00

AS layoffs mount amid the slowing economy, some employers are cutting costs without axing jobs.

Hypertherm has never laid off a permanent employee in its 40-year history. A 20 per cent downturn in sales in recent months led the closely held maker of metal-cutting equipment to eliminate overtime, cut temporary staff and delay a facility expansion, says chief executive Dick Couch.

Managers are transferring employees to busy segments from those with less work. The company may also bring some outsourced manufacturing in-house to keep its 1100 workers busy, Mr Couch says.

Companies such as Hypertherm are the exception. Managing labour costs has become a top priority for US employers, which have eliminated about 1.9 million jobs since December 2007. Last month, US employers cut 533,000 non-farm jobs, and the unemployment rate rose to 6.7 per cent.

Some workplace experts say layoffs are a useful part of the business cycle, allowing employers to weed out poor performers, increase efficiency and promote a high-performance culture.

Layoffs "are not inherently bad," says Mark Nadler, a partner at management consultancy Oliver Wyman's Delta practice. "Some people...are just more crucial to the survival of the organisation than others."

Others say employers often underestimate or overlook the costs of layoffs.
Anat Lechner, associate professor of management at New York University's Stern School of Business, cites expenses for planning, legal fees, severance, outplacement and redistributing work. Layoffs also reduce productivity among survivors and cost a company institutional knowledge, she says.

Add the cost of recruiting and training new workers when business picks up, and layoffs "simply do not make any sense," Ms Lechner says.

In lieu of layoffs, some employers are freezing hiring, offering voluntary retirement packages, cutting hours, reducing salaries or delaying raises.

Other cost-saving tactics include raising employee health-care contributions and slashing bonuses, employer contributions to retirement plans and budgets for training, travel and other perquisites.

Until the recession of the early 1980s, both companies and employees considered layoffs temporary says Peter Cappelli, director of the Centre for Human Resources at the University of Pennsylvania. As the idea of permanent layoffs gained acceptance in the late 1980s and 1990s, employers stopped trying to avoid them, Mr Cappelli says.
Today, many companies argue that alternatives such as across-the-board salary freezes and budget cuts are more harmful, because they can drive away top performers.

Private companies, like Hypertherm may feel less outside pressure to cut jobs and a deeper commitment to employees than publicly held firms, some experts say.

Still, a few public companies - including Lincoln Electric and steelmaker Nucor - also have no-layoff policies.

Lincoln Electric, a Cleveland maker of welding and cutting products, guarantees employment to US workers with at least three years experience, says spokesman Roy Morrow. He says the company, with 9000 employees worldwide, hasn't had a US layoff at least since 1949.

In the early 1980s, the company drew attention for shifting blue-collar factory workers into white-collar sales jobs to avoid layoffs. Today, it routinely cross-trains US workers in key business areas so they can be redeployed, Mr Morrow says.

The current recession is testing Lincoln's policy. The company recently dismissed about 50 contract workers and an undisclosed number of poor performers with less than three years experience. It is also cutting some employees' hours and moving others into positions with lower salaries. Chief executive John Stropki said he's acting "in anticipation of a long, deep recession".

Hypertherm's policy is part of a "social contract" with employees, Mr Couch says. In a downturn, workers are willing to identify inefficiencies because "you know you are not going to work yourself out of a job," he says.

For several months in the early 1980s, Hypertherm adopted a four-day work week. Mr Couch calls that step, "the last of the last resorts," and says he hopes to avoid it this time.

Small businesses, which often have less fat to trim than larger employers, can identify creative solutions. Alex Chang, founder of real-estate search engine Roost.com says, "every $US10,000 a month you can save is a person.”

A big drop in business this fall prompted Mr Chang to cut "every expense we didn't have to make" in order to keep all 17 of his staffers, each of whom he considers vital. He eliminated the marketing budget and asked vendors for discounts. Mr Chang also is considering licensing Roost's technology, moving to a smaller office space and allowing some employees to work from home.

Keeping company costs cut

2009-03-13T12:56:00.000-07:00

'Corporations must understand why costs escalated in the first place, to therefore avoid the need for frequent cost cutting,' explained Bahjat El-Darwiche, a Principal with Booz & Company.

Going after structural issues alone while ignoring the three other critical strands of every organization's DNA - decision rights, information, and motivators - will not help to cut costs and keep them cut.

Transparency of information and costs at all levels is central to any sustainable cost-cutting effort, in addition to the metrics required to monitor these costs.

'Business units and departments without access to such information act as though they have a blank check, which can lead to an explosion of IT costs,' commented Rabih Abouchakra, a Principal with Booz & Company.

With transparency on costs - companies can allocate services by forcing departments to make decisions on the basis of fixed prices, or by open, competitive bidding between service providers.

Once information on the real costs is available, companies can use this to make better, more sustainable cost-cutting decisions - as long as the governance structure is clearly defined, logical, and consistent.

Decision rights involves identifying who is responsible, authorized and accountable for making various decisions.

If these rights are at a high, centralized level, companies will lose time waiting for top executives to make key decisions, and if decision-making authority is too decentralized, redundancies and inefficiencies result as divisions and departments replicate one another's efforts.

Worst of all is a company that hasn't defined these rights, meaning decisions are made by everyone - or by no one at all.

'Senior managers should push decision rights further down the org chart while monitoring the decisions their direct reports make,' commented El-Darwiche.

That expands the senior manager's control and with good information, decision makers become more efficient, lowering the cost of the decision-making process.

Giving managers more responsibility can save money by slowing the increase in organizational layers.

That effort must be accompanied by a system of motivating incentives; 'It means creating a bonus system that rewards managers who meet specific cost targets, not just business targets, as well as developing a promotion strategy that goes beyond standard vertical promotion schemes,' Abouchakra stated.

Companies should develop strategies for top performers that emphasize lateral promotions - conferring more responsibility and higher salaries without a move up the management ladder.

Such moves open up the channels of communication with the increased movement of managers between departments.

Combining structural changes, better managed decision rights, a new approach to incentives and motivators, and the access to cost information, involves taking an integrated approach to a sustainable cost management program.

In one company, distribution costs were a considerable expense, as they were treated as fixed costs and charged back to sales teams as a percentage of sales.

Executives knew that expenditures on distribution varied widely, due to special requests for services such as more frequent delivery and expedited shipping.

Top managers decided the answer was to fix the problem beginning at the level of information transparency.

Introducing a 'rate card' that defined specific charges for added services - at prices competitive with outside distribution services - forced the customer teams to make decisions within a true supply-and-demand regime.

Lower-level managers were also given rights to make decisions on the basis of the information on the rate card, and their incentive structure was changed to reflect not just their sales gains but also their ability to keep costs low.

'Costs came down even more than the company expected and stayed down, and newly empowered managers took the rate-card mantra with them. These changes allowed each division to maintain its lean structure, given team managers expanded spans of control and greater flexibility in making decisions,' concluded Abouchakra.

Costs, once cut, have to stay cut. The only way to do so is to reach deeper into a company's makeup, to put in place an integrated program that takes into account all four of its DNA strands.

Crisis: Best way to cut costs

2009-03-13T12:53:00.000-07:00

India Inc assured the Prime Minister that they will do their best to cope with the current economic crisis without resorting to job losses.

Not a day passed in the past few weeks without news of imminent and real job losses, which has significantly reduced employee morale in all sectors of the Indian economy.

In service businesses like airlines, tourism, banks and insurance, this is disastrous as employee morale is one of the most significant factors that affects customer satisfaction, customer retention and hence, organizational profitability.

Given the serious financial crisis, and the obvious pressures on corporations to stay afloat and survive the crisis, is there no way other than employee retrenchment to cut costs?

In fact, there are several ways of cutting costs which can not only improve employee morale but also make the corporations come out of the crisis much stronger. In this brief article, let me suggest some of the ways of doing this.

First, let us learn from an age-old Japanese tradition. Keitaro Hasegawa, in his Japanese-Style Management (Kodansha International Ltd, Tokyo, 1986) says it is customary for Japanese CEOs to personally guarantee the loans made to their corporations.

Among the first duties of a newly appointed president is to affix his seal to such personal guarantees. While this is not a legal requirement, it is a widely followed common practice. In the event of bankruptcy, the president will forfeit all his private assets to the creditors of the company. In his book, Hasegawa cites the case of the President of Kojin, whose palatial residence in Denenchofu was handed over to the creditors of the company when Kojin went bankrupt.

Thus, while the top management earn much more than the lowest wage earner in a company in good times, they are the ones who take the first blows when the times go bad. Top management will normally cut their salaries, followed by the next layers in strict sequence and only finally, will the lowest wage earners be asked if they too would volunteer to reduce their salaries.

Global meltdown: Complete coverage

Lest the reader dismiss this reference to Japanese ways of doing things as something that will work only in Japan, let me cite two other examples from the western world.

In the early part of the 20th century, when Cadbury's was in dire straits, Sir George Cadbury personally bankrolled the company for six months. He had worked out that there was just about enough money in his personal control to (a) continue to run the company for six months with a view to turn it around and then, (b) if that did not work out, settle all dues owed to creditors, suppliers and employees. That Cadbury's turned around within those six months and is still a respected name around the world is in no small way attributable to the values that Sir George infused into the company.

In 1982, when 18 major US steel companies recorded a combined loss of $3.2 billion, two steel companies in California -- Nucor Corporation and Chaparral Steel -- recorded profits. The secret behind their success was that they had done what the Japanese would have done.

First, their top management cut down their salaries by 50 per cent, then the administrative officials responsible for the production division cut down their salaries by 35 to 40 per cent, and only then was the income of the hourly staff cut down by 20 to 25 per cent. Not a single employee was retrenched. That the entire organization had jointly tightened their belt and seen the crisis through as a cohesive team should be obvious to anyone. This was in California and not Japan! (For more on this, readers can refer to my book, Thresholds of Motivation, Tata McGraw-Hill, 1993)

Yet another way of cutting costs without resorting to retrenchment is what we did in the Taj Group of Hotels in the early 1990s. When the Middle East exploded following Saddam Hussein's march into Kuwait, tourism and hotels was among those Indian industries that got badly affected badly.

As the crisis escalated in August/September, the beginning of the tourist season in India, we witnessed mass cancellations of hotel bookings. In the Taj Group, we knew that we were in for a bad year. Rather than taking the axe out to cut employee force, we did something quite different. We ran "cost-reduction" workshops in all hotels, where employees were asked to come up with suggestions on how to cut waste and unnecessary costs.

We assured them that in the best traditions of the Tatas, we would try our very best to jointly cope with the crisis and did not threaten them with mass retrenchment. Employees responded with literally thousands of suggestions and we rode the storm jointly and came out much stronger as a team when the crisis ended. In one hotel, we cut food costs by 10 per cent, largely because of suggestions that came from the lowest rungs of the kitchen staff.

As Richard Bach once wrote, "Every problem has a gift in its hands." The current crisis, albeit the worst of its kind that we have faced since becoming independent, can still be converted into an opportunity by true leaders who are ready to lead by example -- like the captain of a ship that is in troubled waters...and the Japanese, Nucor, Chaparral, George Cadbury and Tatas. All it needs is the willingness of top management to first tighten their belts before they start asking others to do so.

Economic Crisis of 2009

2009-03-09T10:52:00.000-07:00

Japan's recession deepened in November as companies cut production at the fastest pace in 55 years and rising unemployment prompted households to pare spending.

Factory output plunged 8.1 percent from October, the Trade Ministry said today in Tokyo, more than the 6.8 percent estimated by economists. The jobless rate climbed to 3.9 percent from 3.7 percent. Household spending slid 0.5 percent, a ninth drop.

Simultaneous recessions in the U.S. and Europe have weakened demand for Japan's exports, prompting companies from Toyota Motor Corp. to Sony Corp. to idle plants and fire workers. The Bank of Japan has little room to spur the economy after cutting interest rates close to zero last week, and Prime Minister Taro Aso has yet to implement two stimulus packages.

“Data clearly indicate the problem for Japan is deflation, not inflation,” said Yasunari Ueno, chief market economist at Mizuho Securities Co. in Tokyo.

Bank of Japan Considers Extraordinary Steps

With export demand plunging and the Yen soaring, the BOJ May Consider ‘Extraordinary Steps,' Kamezaki Says

“The Bank of Japan is committed to doing its utmost to contribute to stabilizing financial markets,” Kamezaki, 65, [policy board member] said today at a business meeting in Takamatsu, western Japan. “Extraordinary times demand extraordinary steps.”

Central bank officials are examining the feasibility of buying a wider range of securities, including corporate bonds and stocks, and the policy board will make a decision based on their findings, Kamezaki said at today's press conference.

Japan PM announces record budget

The Prime minister of Japan, Taro Aso announces record budget .

Taro Aso, Japan's prime minister, tried to put a rocket under the stricken economy on Wednesday, announcing the country's biggest ever annual budget, as fear mounts that Japan faces a long recession.

The budget for the fiscal year starting next April, along with two other extra budgets for the current year, will finance Aso's Y12,000bn in fiscal stimulus programmes, which amounts to more than 2 per cent of Japan's gross domestic product.

Ministers said the stimulus was as large as or even larger than steps adopted in other major economies. But it also meant Japan's primary budget deficit will nearly triple, making Tokyo's target of a surplus in two years almost impossible.

”Japan cannot avoid the tsunami of the world recession, but it can try to find a way out,” Mr Aso told a news conference, in which he illustrated the government's stimulus plans with a diagram of a three-stage rocket.

”The world economy is in a once-in-a-hundred-years recession. We need extraordinary measures to deal with an extraordinary situation,” he said.

Japan's Extraordinary Measures Have Blown Up Already.

Extraordinary measures are a way of life for Japan. From currency intervention to building bridges to nowhere, Japan has taken extraordinary measures for decades. In that timeframe, Japan went from being the largest creditor nation to a nation deep in debt.

As of November 17th 2008, BusinessMirror notes " Japan's public debt that exceeds 180 percent of the GDP, limiting the government's ability to stimulate growth ".

It takes pretty extraordinary measures to achieve public debt of 180% of GDP, and although that feat did not produce anything worthwhile, Aso wants to try it again. Keynesian clowns should take note, but they don't.

China Needs More Policies to Spur Consumption

Peoples Bank of China's Zhou Says China Needs Policies to Spur Consumption .

China needs to devise more policies to boost consumption among the nation's 1.3 billion people to counter the impact of falling exports on economic growth, central bank Governor Zhou Xiaochuan said.

“Although the government has pledged to boost consumption to sustain growth, we still face difficulties in identifying which areas and which measures we should take to spur spending,” Zhou told a conference in Beijing today. Economic policies have failed to rebalance growth away from trade and investment, with the share of consumption in gross domestic product falling to less than 50 percent from 60 percent a decade ago, he said.

Premier Wen Jiabao may unveil a second stimulus package as early as next month aimed at spurring consumer spending as the economy is set for its slowest growth in two decades. The government has already increased subsidies for farmers to buy household electronics, cut taxes on property and is preparing policies to revive slumping car sales in the world's second- biggest auto market.

China's household consumption rate “is among the lowest in Asia as households still hold large precautionary saving balances,” said Ben Simpfendorfer, a Hong Kong-based economist with Royal Bank of Scotland. He estimates household consumption growth slowed to 5 percent in 2008 after rising at double that pace the previous year.

The U.S. economy faces the opposite problem, Zhou said today, with consumption too high and the savings rate too low. The policies now being pursued by the Bush administration to revive growth by boosting consumption aren't the solution to the country's long-term structural economic problem, he said.

Consumer spending represents more than two-thirds of the U.S. economy while household consumption's share of China's gross domestic product slumped to slightly more than 35 percent last year from 45 percent a decade ago, according to Chinese government data.

“This shows there is huge potential to boost consumer credit and encourage people to buy homes and cars,” Yi said.

No Savings Glut

Statements from Yi, Zhou, and Ben Simpfendorfer promote the silly idea there is some sort of savings glut in China. There isn't. Please see Global Savings Glut Exposed and Bernanke Blames Saving Glut For Housing Bubble for counter arguments.

“ This shows there is huge potential to boost consumer credit and encourage people to buy homes and cars,” Yi said . Does anyone learn? Credit bubbles caused the great depression, and the great recession that we are in. One might think that someone in authority would learn something from this. But they never do. China wants to follow the US to ruin.

Besides from a simple Austrian economic standpoint it it not possible to have too much savings. It is possible however to have too much debt and that is where the US is right now.

China Currency Reserves Drop For First Time In 5 Years

Market New is reporting China Currency Reserves Post First Fall Since 2003

China's foreign-exchange reserves dropped for the first time in five years as a result of the global financial crisis, Market News International reported, citing Cai Qiusheng, head of the investment management bureau under the State Administration of Foreign Exchange.

The current figure must be lower than the peak of about $1.9 trillion, Cai told a trade forum in Beijing over the weekend, the English-language wire service said. He didn't specify which period he was referring to or give a figure.

China's foreign exchange reserves $1.9 trillion at the end of September, according to Bloomberg date.

Please see Strange Case of Falling International Reserves Explored for more on reserves.

Korean Economy Faces Contraction

South Korea president Lee Lee Myung Bak Warns Korean Economy May Shrink in First Half

South Korea's economy may shrink in the first and second quarters of next year, affected by a global economic slowdown, President Lee Myung Bak said today.

“The world economy is difficult and South Korea is heavily dependent on the external side,” Lee said at a meeting at the presidential house in Seoul today, according to his office Web site. “Even though we may post positive annual growth, we're in danger of negative growth in the first and second quarters.”

“Negative growth is unavoidable,” said Chun Chong Woo, senior economist at SC First Bank Korea Ltd. “We're bound to be affected by the global slump, and the government will have to think of more aggressive policies to help spur the economy.”

The Bank of Korea has cut its key rate by 2.25 percentage points since October, the most aggressive easing since it first set a benchmark in 1999. The bank most recently cut the benchmark rate by 1 percentage point to a record low 3 percent on Dec. 11.

South Korea is also pumping funds into banks, cutting taxes and boosting public spending to limit the fallout from the global credit crisis, which sent the Korean won down more than 28 percent and the stock index tumbling 41 percent this year.

“We see the first and second quarters to be the bottom,” Lee said. “There's hardly any country posting economic growth from the fourth quarter to the first quarter. “There is an end to this agony,” he said. “It won't last 10 or 20 years.”

An End To Agony, When?

Where do people get the idea this is all going to be over in a couple quarters? Somehow Bak makes the magic leap of faith the recession will be over soon just because it will not last 10 years. I suggest it lasts another year or longer. Even when the recover comes it will be anemic as the US consumer is tapped out and will be devastated by the stock market and housing carnage. Frugality will be the new reality for quite some time.

Vietnam's Weak Dong Policy

Struggling to boost exports, Vietnam Devalues The Dong .

Vietnam's central bank devalued the dong by 3 percent to help exporters after the Southeast Asian economy expanded at the slowest pace in nine years and the trade deficit widened.

“The devaluation is necessary as the government is trying to increase exports,” said Do Ngoc Quynh, chairman of the Vietnam Bond Forum in Hanoi and head of currency and debt trading at Bank for Investment & Development of Vietnam, the nation's second-biggest lender by assets. “Other currencies in the region have considerably declined against the dollar, but the dong hasn't dropped that much.”

“The Vietnamese dong is facing downward pressure due to the current-account deficit,” said Yuichi Izumi, an economist at Nomura Securities Co. in Tokyo. “The State Bank wants to guide the dong lower to support the export sector.”

Slower gains in consumer prices may have also provided more room for the central bank to weaken the dong. Inflation cooled for a fourth month in December to the slowest pace in nine months, with consumer prices rising 19.9 percent from a year earlier, the government said today. The rate touched 28.3 percent in August, the highest since at least 1992.

Fiscal insanity is everywhere you look. Inflation is running at 19% yet Vietnam wants a weaker dong. And with serious downward pressure, it's wrong to be long the dong.

By Mike "Mish" Shedlock
http://globaleconomicanalysis.blogspot.com

Click Here To Scroll Thru My Recent Post List

Mike Shedlock / Mish is a registered investment advisor representative for SitkaPacific Capital Management . Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction.

Visit Sitka Pacific's Account Management Page to learn more about wealth management and capital preservation strategies of Sitka Pacific.

I do weekly podcasts every Thursday on HoweStreet and a brief 7 minute segment on Saturday on CKNW AM 980 in Vancouver.

When not writing about stocks or the economy I spends a great deal of time on photography and in the garden. I have over 80 magazine and book cover credits. Some of my Wisconsin and gardening images can be seen at MichaelShedlock.com .

February Month Layoff List

2009-03-09T10:40:00.000-07:00

December 2008 Layoffs List

2009-02-08T09:41:00.000-08:00

1. AMD (nyse: AMD), Layoff announced: 12/29/08, Employees affected: 100
2. Johnson Controls (nyse: JCI), Layoff announced: 12/23/08, Employees affected: 125
3. Las Vegas Sands (nyse: LVS), Layoff announced: 12/23/08, Location: Macau, Employees affected: 500
4. Parker-Hannifin (nyse: PH), Layoff announced: 12/22/08, Employees affected: 405
5. Eaton (nyse: ETN), Layoff announced: 12/22/08, Employees affected: 331
6. Genworth Financial (nyse: GNW), Layoff announced: 12/19/08, Location: worldwide, Employees affected: 1,000
7. Electronic Arts (nasdaq: ERTS), Layoff announced: 12/19/08, Employees affected: 1,000
8. Sovereign Bancorp (nyse: SOV), Layoff announced: 12/19/08, Employees affected: 1,000
9. Omnicom Group (nyse: OMC), Layoff announced: 12/18/08, Employees affected: 3,000
10. Caterpillar (nyse: CAT), Layoff announced: 12/18/08, Employees affected: 814
11. Ryder System (nyse: R), Layoff announced: 12/17/08, Location: South America, Employees affected: 3,100
12. Western Digital (nyse: WDC), Layoff announced: 12/17/08, Employees affected: 2,500
13. Aetna (nyse: AET), Layoff announced: 12/17/08, Employees affected: 1,000
14. Bristol-Myers Squibb (nyse: BMY), Layoff announced: 12/17/08, Employees affected: 3,700 (in addition to 10% cut in back in July)
15. CBS Corp (nyse: CBS), Layoff announced: 12/16/08, Employees affected: 30
16. Merrill Lynch (nyse: MER), Layoff announced: 12/15/08, Employees affected: 400 (amateur brokers-in-training)
17. Charles Schwab (nasdaq: SCHW), Layoff announced: 12/15/08, Employees affected: 100
18. Union Tank Car Company (majority owned by Berkshire Hathaway (nyse: BRK.A)), Layoff announced: 12/13/08, Employees affected: 130
19. Masco (nyse: MAS), Layoff announced: 12/12/08, Employees affected: 500
20. International Paper (nyse: IP), Layoff announced: 12/12/08, Employees affected: 1,500
21. Las Vegas Sands (nyse: LVS), Layoff announced: 12/12/08, Location: Las Vegas area, Employees affected: 216
22. Bank of America (nyse: BAC), Layoff announced: 12/11/08, Employees affected: 35,000 (over three years)
23. Whirlpool (nyse: WHR), Layoff announced: 12/11/08, Employees affected: 150
24. Dal-Tile (owned by Mohawk Industries (nyse: MHK)), Layoff announced: 12/10/08, Location: Gettysburg, Pa, Employees affected: 105
25. Procter & Gamble (nyse: PG), Layoff announced: 12/10/08, Closure of Clairol plant, Employees affected: 320
26. Praxair (nyse: PX), Layoff announced: 12/9/08, Employees affected: 1,600
27. Anheuser-Busch (nyse: BUD), Layoff announced: 12/8/08, Location: US nationwide, Employees affected: 1,400; Contractors affected: 415
28. 3M (nyse: MMM), Layoff announced: 12/8/08, Employees affected: 2,300
29. Wyndham Worldwide (nyse: WYN), Layoff announced: 12/8/08, Employees affected: 4,000
30. Dow Chemical (nyse: DOW), Layoff announced: 12/8/08, Closure of 20 plants, Employees affected: 5,000 (11% of staff)
31. Legg Mason (nyse: LM), Layoff announced: 12/5/08, Employees affected: 200 (8% of staff)
32. Newsday (owned by Cablevision (nyse: CVC)), Layoff announced: 12/5/08, Employees affected: 100
33. Staples (nasdaq: SPLS), Layoff announced: 12/19/08, Employees affected: 140
34. General Motors (nyse: GM), Layoff announced: 12/5/08, Employees affected: additional 2,000
35. Steel Dynamics (nasdaq: STLD), Layoff announced: 12/4/08, Employees affected: 65
36. Cummins (nyse: CMI), Layoff announced: 12/5/08, Employees affected: 500
37. Windstream (nyse: WIN), Layoff announced: 12/4/08, Employees affected: 170
38. NBC Universal, Layoff announced: 12/4/08, Employees affected: 500 (3% of workforce)
39. DuPont (nyse: DD), Layoff announced: 12/4/08, Employees affected: 2,500
40. AT&T (nyse: T), Layoff announced: 12/4/08, Employees affected: 12,000 (4% of workforce)
41. Freeport-McMoRan Copper & Gold (nyse: FCX), Layoff announced: 12/3/08, Location: New Mexico mine, Employees affected: 600
42. Pratt & Whitney (owned by United Technologies (nyse: UTX)), Layoff announced: 12/3/08, Employees affected: 350
43. Gannett (nyse: GCI), Layoff announced: 12/3/08, Employees affected: 2,000
44. Adobe Systems (nasdaq: ADBE), Layoff announced: 12/3/08, Employees affected: 600
45. Jefferies Group (nyse: JEF), Layoff announced: 12/3/08, Employees affected: 300 (13% of workforce)
46. Viacom (nyse: VIA), Layoff announced: 12/3/08, Employees affected: 850
47. United States Steel (nyse: X), Layoff announced: 12/2/08, Employees affected: 3,500
48. JPMorgan Chase (nyse: JPM), Layoff announced: 12/1/08, Employees affected: 9,200 (21% of WaMu staff)
49. PepsiCo (nyse: PEP), Layoff announced: 12/1/08, Location: Oklahoma Gatorade plant, Employees affected: 87

US Private Job Losses Mount

2009-02-08T09:29:00.001-08:00

Job losses and plans to lay off workers hammered the struggling U.S. economy in the final month of 2008, according to private reports that could foreshadow surprisingly grim labor market data from the government on Friday.

U.S. private employers shed 693,000 jobs in December, up sharply from the revised 476,000 jobs lost in November and far more than economists estimated, a report by ADP Employer Services said on Wednesday.

The data comes two days ahead of the government's more comprehensive non-farm payrolls report, which unlike the ADP numbers includes public sector jobs as well.

Analysts said there was reason to expect a worse outcome in non-farm payrolls than their original projection of 500,000 jobs lost for the economy in December, which was the median of economists' forecasts in an earlier Reuters poll.

"This is shockingly awful," said Ian Shepherdson, chief U.S. economist at High Frequency Economics in Valhalla, New York.

"If the recent relationship between the ADP numbers -- after their recent revisions -- and the official payroll data holds, then we should expect a number of about minus -700,000 on Friday, the biggest drop in 59 years."

Most analysts noted Wednesday's ADP report was the first released under a new methodology, warning of uncertainty over its forecasting power. Still, the new system was designed to more closely mirror the government's monthly payrolls results.

Separate data showed planned layoffs at U.S. firms eased in December from the previous month's seven-year high but were up an astounding 275 percent annually as the year-old recession cut a huge swathe of destruction through job market.

The economic slump, which is likely to be the longest since the Great Depression of the 1930s, also produced the worst year of layoffs since 2003, outplacement company Challenger, Gray & Christmas added in its monthly report on U.S. job cuts.

The grim data helped push U.S. stocks lower. Government bond prices, which generally benefit from signs of economic weakness, pared their losses in the immediate wake of the ADP release but later went back on the slide.

Underlining the bleak outlook, the Congressional Budget Office said in new forecasts released on Wednesday that it expected the U.S. economy to contract 2.2 percent in 2009 before recovering in 2010 to grow 1.5 percent.

MORE PESSIMISTIC NOW

The ADP December job losses were the biggest since the survey's launch in 2001.

"Expectations for Friday's nonfarm payroll release will be more pessimistic than they were before this morning's data round," said Christopher Low, chief economist at FTN Financial in New York.

"For now, the consensus is minus-500,000, but we have to assume people are thinking minus-600,000 or more is possible."

Indeed, Scott Anderson, senior economist at Wells Fargo Economics in Minneapolis, said he raised his forecast to "at least 600,000" December job losses from an earlier projection of 500,000.

Anderson also raised his forecast for the unemployment rate to 7.1 percent from 7.0 percent before. The median forecast for unemployment in the Reuters poll was a rise to 7.0 percent from November's 6.7 percent.

Analysts at RDQ Economics also said they raised their expectations to 600,000 job losses from their earlier projection of 500,000.

Shepherdson, at High Frequency Economics, said even the best case scenario implied a payrolls drop of 568,000.

Joel Prakken, chairman of Macroeconomic Advisers, which jointly developed the ADP report, said the ADP data was consistent with a loss of about 670,000 jobs in the payrolls report, assuming some 20,000 government jobs would be added.

Worse yet, he said he still expected a little more than 2 million U.S. job losses over the next year.

He added that the U.S. economy probably contracted at a 5.5 percent annualized rate in the fourth quarter and would shrink 3.5 percent in the first quarter of this year.

"After that economic growth is going to depend on the size and timing of the fiscal package that is being discussed in Washington right now," Prakken said.

The Challenger report said heavy job-cutting could continue through at least the first half of 2009.

Job cuts announced in December totaled 166,348, down 8.4 percent from November's 181,671, Challenger, Gray & Christmas said. Despite the monthly decline, layoffs were up from just 44,416 in the year-ago period.

Unemployment Rate Hits 7.2%

2009-02-08T09:27:00.000-08:00

Some 2.6 million Americans lost their jobs in 2008, the worst toll since the end of World War Two, data showed on Friday, and industrial output plunged across Europe as the global economic crisis bit deeper.

The U.S. unemployment rate jumped to 7.2 percent in December and 524,000 people lost their jobs that month, U.S. surveys showed.

"The job situation is ugly and is going to get uglier," said Richard Yamarone, chief economist with Argus Research in New York. "There's no reason to expect hiring any time in the next three to six months. We are not going to see any hiring until the government steps in and acts. Talk doesn't work."

The unemployment rate, which jumped from 6.8 percent in November, was the highest level since January 1993. Companies are cutting jobs across the world because of the stranglehold on consumer and corporate funding since a credit boom went bust a year and a half ago.

U.S. President-elect Barack Obama said the U.S. economy could stay mired in recession for years without bold action.

"I don't believe it's too late to change course, but it will be if we don't take dramatic action as soon as possible," Obama said in a speech in Fairfax, Virginia on Thursday. "If nothing is done, this recession could linger for years."

"When we look at where companies are, in the conversations they're having, we anticipate continued job losses for at least a couple quarters," said Jeff Joerres, chief executive of Manpower Inc, one of the world's largest staffing and outplacement firms.

The North American chief of rival Adecco SA said a decline in overtime and total hours worked suggests more job losses ahead, since employers typically cut hours before they eliminate jobs.

"We have 150,000 clients in the U.S., and I can tell you one company after another is convinced this recession is not going away," Adecco's Tig Gilliam said. He predicts January and February payroll data will show cuts as deep as those seen in the quarter just ended.

"We're in an accelerating job-loss mode," he said.

Adecco is the third largest U.S. employer, behind Wal-Mart Stores and the postal service. Overall, U.S. staffing companies employ almost 3 million people a day and hire some 11 million temporary and contract workers a year, according to the American Staffing Association.

A further negative sign is that professional job categories are losing jobs, said Scot Melland, chief executive of Dice Holdings, which runs specialized job sites focused on areas like finance and technology.

Meanwhile, worker supply is rising, as more people reenter the work force and those anxious about their jobs start to test the waters. Job applications in the latest quarter were up 20 percent versus a year ago, Dice Holdings said.

STIMULUS HOPES

The U.S. job market typically lags the wider economy by three to six months, and so far efforts to stabilize the financial system have not a had a visible effect, Melland said. That underscores the need for a government stimulus that would target consumer spending.

"People who have jobs today don't have the confidence to spend," Adecco's Gilliam said.

U.S. President-elect Barack Obama, who takes office January 20, is seeking approval by mid-February of his plan for tax cuts and public-works spending that could total up to $800 billion.

"I think the infrastructure investment is important and needed, but it's also not sufficient," Gilliam said. Friday's jobs report "clearly puts emphasis on the need for Congress and the President to not talk about job growth but to stop the job loss first."

Key to any Obama strategy -- both short- and long-term -- will have to be a focus on education, Gilliam said, citing areas like finance, information technology and medical skills.

BRIGHT SPOTS

Such high-skilled jobs offer a bright spot in the current labor market. The unemployment rate for college-educated workers is 3.9 percent, compared to 10.9 percent among those who never finished high school.

Unemployment in technology is less than half the national average, and IT specialists remain in demand in part because tech investment can help companies cut costs during a downturn, said Dice's Melland.

Also, some parts of the country -- such as Boston; Washington, D.C.; and Milwaukee -- have jobless rates well below the national average, in stark contrast with areas like Detroit, Las Vegas and Los Angeles, according to Adecco.

One trend to watch is whether job losses among temporary workers slow in coming months. This part of the labor market has seen disproportionate job cuts in recent months, said Manpower's Joerres.

"The precipitous drop we've seen in temp help numbers ... will now start to go more in lockstep, because you can only take so much out on the temporary side," Joerres said.

The percentage of temporary workers in the labor force, at 1.54 percent, is the lowest since May 1996, BMO Capital Markets analyst Jeffrey Silber said in a research note.

"The bottoming of this metric typically correlates to the end of a recession," he said. "Unfortunately, we're not there yet."

January 2009 Layoff Lists in the total World

2009-02-08T09:15:00.000-08:00

This is a list of the total announced layoffs at America's 500 largest public companies as measured by a composite ranking of sales, profits, assets and market value during January 2009.

Total Announced Layoffs: 151,352

January 5th

Cigna: reduces workforce by 4% (1,100 jobs).
United States Steel: cuts 50 jobs as it closes production lines in Texas.

January 6th

Alcoa: starts global salary and hiring freeze, plans sale of four non-core businesses and cuts workforce by 13% (13,500 jobs).
Aqua Glass (Masco): pink-slips 30 employees.

January 7th

EMC: fires 2,400 as it reduces 2009 expenses by $350 million.

January 8th

Union Pacific: pink-slips 230 as company struggles; stock down 22% year-to-date.
Bath Iron Works (General Dynamics): dismisses 179 employees.
Eaton: 78 laid off in Iowa.
Walgreen: cuts 1,000 (roughly 9%) from corporate and field manager ranks.

January 9th

Oracle: cuts 500 from U.S. sales and consulting businesses.
Boeing: cuts 4,500 and returns workforce size to what it was in early 2008.
Freeport-McMoRan: cuts workforce in half at Arizona mine; 1,550 workers let go.
Smitfield Foods (Butterball): Fires 75 at Missouri plant.

January 12th

Mosaic: 1,000 employees in Saskatchewan.
Aircraft maker and Textron (Cessna): 2,000 employees fired.
Best Buy: 12.5% of its headquarters staff with 500-employee layoff.
Precision Castparts: dismisses 40 as airline industry continues to struggle.

January 13th

Cummins: freezes salaries for the rest of the year and lets 800 go.
Pfizer: cuts 800 researchers as it lowers cost in the face of poor performance and coming patent losses.

January 14th

Ecolab: restructures and reduces workforce by 4% (1,000 jobs).
Delta Air Lines: gives 2,000 early retirements as part of 8% capacity reduction.
Motorola: lays off 4,000 following a 3,000-worker layoff last year; savings of $700 million a year.
Google: fires 100 hirers cutting back on contract workers and temporary employees.

January 15th

Xerox: cuts 275 jobs in New York region.
MeadWestvaco: fires 2,000 and plans closings or restructurings at up to 14 plants.
Autodesk: expects loss from 2008 fourth quarter; pink-slips 750 (10% of workforce).
Marshall & Ilsley: cuts 8% of staff (830) in ongoing cost-cutting.
General Electric: jet-engine group cuts 1,000 white-collar jobs.

January 16th

ConocoPhillips: trims capital spending by 18%, writes off $34 billion and reduces workforce by 4% (1,300 jobs).
Hertz Global Holdings: sets out for worldwide restructuring in first quarter of 2009; cuts 4,000 jobs.
WellPoint: reduces workforce by 600 and removes 900 open positions.
Advanced Micro Devices: reduces global workforce by 9% (1,100 jobs).

January 20th

Clear Channel Communications: reduces workforce by 9% accounting for 1,850 job losses.
Deere & Company: dismisses 120 at Iowa plant.

January 21st

Burlington Santa Fe: cuts 2,500 workers (5% of workforce).
UAL: fires 1,000 to cut overhead costs.
SPX: attempts to sell a business unit and cuts 400 employees to help endure the downturn.
Intel: closes five manufacturing plants and pink slips 5,000.
Walt Disney: offers voluntary buyouts to 600 theme park executives on poor attendance.
Wynn Resorts: wraps up construction on Las Vegas Strip casino with 53-worker layoff in design and construction affiliate.
Eaton: total workforce reduction since the beginning of last year to 10% with 5,200-worker cut.
Warner Bros. Entertainment (Time Warner): cuts 10% (800) of its jobs.

January 22nd

Microsoft: has first mass layoff in 34-year history; pink slips 5,000.
Huntsman: reduces workforce by 9%; cutting 1,175 regular workers and 490 full-time contractors.

January 23rd

Deere & Company: subsidiary lays off 502 employees.
Abercrombie & Fitch: cuts 50 from headquarters as company leans expenses.
Harley-Davidson: sees 60% drop in profits in fourth quarter of 2008; fires 1,100 (10% of workforce).

January 26th

Lincoln National: posts five quarterly declines in profit; cuts 540 (5% of workforce).
Caterpillar: announces quarterly profit plunge of 32%; fires 20,000.
Pfizer: closes five factories and cuts 15% of total workforce (19,000 workers).
Sprint Nextel: pink-slips 8,000 workers--recording more than $300 million in severance charges but saving $1.2 billion a year in labor costs.
Home Depot: closes high-end home design shops and slims ranks at headquarters; dismisses 7,000.
General Motors: cuts production at several plants and fires 2,000 in Michigan and Ohio.
Texas Instruments: pink-slips 3,400 (12% of workforce).
IBM: selects 2,800 to participate in its “current resource reduction action.”

January 27th

AOL (Time Warner): reduces workforce by 10% (700 workers) as it fights declining ad revenue.
Merillat (Masco): cuts 20% of workforce (70 workers).

January 28th

Starbucks: organizes closings at 900 stores worldwide and fires 6,700 in the process.
Target: cuts 400 open positions and 600 employees on sagging sales.

10 tips to survive a layoff, financially smarter

2008-11-18T08:20:00.000-08:00

1. Negotiate with your employer to get a good severance package.

2. If you have a debt of any kind -- home loan, personal loan, credit card payment etc -- make provision for that first from the money that you can squeeze out from your ex-employer.

3. In the meanwhile, try to search for job, even if on a temporary basis, matching your skills and profile.

4. Your next priority should be your grocery expenses.

5. There is no need to tell you that when you are laid off or are expecting the same you should come down heavily on your socialising expenses including outings to hotels, multiplexes, vacations et al.

6. Try asking your parents and friends for some money in case your severance package amount fails to meet your monthly expenses.

7. If your severance package is good make sure that you keep at least 20 per cent of this money into an emergency fund.

8. If charity begins at home, cost cutting too should begin from home.

9. Spend most of your time fine tuning your resume, preparing for interviews, adding new skill sets related to your job profile.

10. Finally, don't forget to make a plan about your future as you will have enough time to ponder over your finances and career.

How To Survive A Layoff Or Downsizing

2008-11-18T08:19:00.001-08:00

Layoffs used to be temporary in nature. This meaning has changed now because, for a long time, this term has been used for referring to the permanent elimination of employees as a part of the cost-cutting measure. One of the most difficult situations in an employee's life is when the main source of income comes to a full stop.

However, it is essential for you to keep cool and create strategies to overcome it.

Here are some tips that can be incorporated in order to survive a layoff or downsizing:

• Define your network: The first step towards surviving a layoff is to define a network of friends, co-employees, and professional associations that may be of some help.

• Approach the HR department: You may ask your former HR department to help you get a job. The HR department is one of the powerful departments in an organization and has a lot of contacts.

• Update your resume: The resume is one of the most essential marketing tools while searching for a job. Make sure that your resume is clear and concise and is written specifically. It serves as one of the best ways to market your talents. With this fact in mind, make sure that your resume is written according to the company's requirements. Try to present a brief overview of your qualifications to the interviewer.

• Scan classifieds for potential employers: Scanning for potential employers is important as it will give you an idea about which companies require employees with the kinds of skills that you possess. The main idea behind scanning through the classifieds is to check for those companies that are well-established and are not facing any losses.

• Reorganize your finances: Make sure you organize your finances as soon as you have been laid off. Try to save more money than ever before and sell things that you are likely not to use in the near future.

• Contact the unemployment office in your state: As soon as possible, contact your state unemployment office, as it helps in getting the waiting period out of the way.

• Submit your updated resumes to different job portals: In order to get a job faster, submit your resume to as many online job portals as possible. Highlight your skills and qualifications and approach a number of employers simultaneously. Be sure to use cover letters that are specialized for each company and job opening.

• Contact references: You may also contact references and let them know that you are back in the market. They may be able to help.

• Request a recommendation letter: Recommendation letters help people get better opportunities in life. In order to get a good job, you may ask your former employers to draft a recommendation letter for you and if it is convenient and not too busy, mention what has happened to your previous employer.

• Practice mock interviews: To present yourself in a better way, you should practice mock interviews so that you can confidently deal with the interviewer.

Losing a job is never easy; the tips above can make it easier to make your way through.

Tips to help you survive a layoff

2008-11-18T08:18:00.001-08:00

With times looking grim for the U.S. economy, it's important to keep your head up and plan for your next step in case you are laid off. This may be difficult because the fear of a layoff could be so paralyzing, it is difficult to find a new job. Richard Bayer, a former professor of economics and ethics who currently serves as COO of The Five O'Clock Club, a career coaching and outplacement network, says that you may end up better off than you were before you were laid off.

"Resist the urge to think of unemployment as the end of the world, no matter how upsetting it may be," he says. "Think of it instead as an opportunity to improve yourself and to make a fresh start. Maybe you're going to find out that what you enjoy doing and do well is different from what you were doing."

Bayer offers seven steps for keeping your boat afloat, among them:
> Negotiate the best possible severance package.
> Make job hunting your new job.
> Expand your search.
> Stop reading about the economy

For more on job search techniques:
- check out this CIO.com article

How to survive a layoff

2008-11-18T08:16:00.000-08:00

Although the job market is getting tougher to navigate during the weak economy, there are still ways to get around it.

Jay Gingrich, at StaffMe.net, says if you're laid off, the first thing you should do is not panic. Look to friends and family for support and most important, act quickly.

"During a layoff, your other coworkers are being laid off, too. There is a lot of competition going into the market," he explained.

Second, update your resume and get friends and family to critique it. Once it's done, get it out there, especially on the Web.

"If you are looking to stay local, start with your local job boards," Gingrich suggests. "Then begin to register with national boards like StaffMe.net, Monster and Career Builder.

Third, take the time to define your career goals and be open to moving.

"If the opportunity presents itself, you need to jump on it. Change can be a good thing," Gingrich says.

He adds that you should always have a polished resume.

If you think your job could be in jeopardy, it's okay to post your resume as long as you don't disclose confidential information about your company.

Currently, the average time someone is unemployed is 17.5 weeks so it's a good idea to try to have money saved to cover that length of time.

How to Survive a Company Layoff

2008-11-18T08:15:00.000-08:00

With the exception of being let go from a retail position after a store closing when I was in college, I have never been on the receiving end of a layoff. However, I was unfortunate enough to have to deliver the news to team members who worked with me at my last job, and it was one of the most unpleasant experiences I have ever had to deal with at work. Through their painful experiences I have been able to gather a few tips for surviving a layoff.

Sink or Swim

I personally don’t believe in layoffs because I am sort of a “sink or swim” kind of guy. When an employee devotes their time and energy to a company they deserve some loyalty in return. Sink or swim, employees and companies should be in it together. Unfortunately, corporate America is mostly concerned with bottom lines, so they frequently take the opportunity to “weed out” employees who earn too much, produce too little, or are nearing retirement benefits. If “dead wood” exists in an organization it should be dealt with individually, but not by taking otherwise hardworking casualties along with them as part of a massive layoff. OK, enough of my rant, back to surviving a layoff.

Keep Your Ear to the Ground

If your company has announced a round of layoffs it means there are storm clouds on the horizon, regardless of how secure you may feel about your particular job. If you are lucky enough to be notified ahead of time, use this advanced warning to your advantage. Put your financial turnaround on hold and quickly begin stockpiling cash. Here are a few ideas to guide you though this most difficult event:

Pay minimums on ALL debt, nothing extra. It is important not to get behind with storm clouds on the horizon, so continue to stay current on all debt accounts. If you were making additional debt snowball payments, suspend those temporarily until the storm clouds have passed, or until you have found another job.

Pile up cash in an emergency fund. Using the debt snowball amount you were previously paying on that smallest debt as a starting place, throw every single dollar you can find in an emergency fund. Have a yard sale, sell stuff on eBay, and look for some quick-to-hire part time work. This emergency fund will have to sustain your family until you can find new employment, a period that could take weeks, or even months.

Negotiate. When you get your pink slip, negotiate as many benefits as you possibly can before your exit interview is over. Don’t be satisfied to just get a promise of a good reference and any unpaid vacation. Companies, especially large companies, want to make this as smooth a transition as possible to limit any negative publicity. Use that to your advantage and ask for an extension of health coverage, or additional paid weeks per year of service. Work any angle you can to maximize your severance package. Remember, you have a family to feed! Don’t worry about appearing ungrateful, or making anyone mad. What’s the worst they could do - fire you?

Use severance funds first, then the emergency fund. It isn’t easy dealing with a drastic drop in income. Consider depositing severance funds in a separate savings account and set up biweekly withdrawals in roughly the same amount as your previous take home pay. Do not touch this money for any reason other than living expenses and perhaps some small job hunt expenses (travel, new suit, etc.), and in that case be extremely frugal. Remember, this money supply is finite. If you get frivolous now because you feel sorry for yourself you will be broke in no time and find yourself feeling even worse.

Find a new job, and fast. Now is not a time to sit around having a pity party. Get out there and find a new job. Work your network of friends and family. Keep in touch with other colleagues who have been rehired and ask them for any leads. Brush up on your interview skills. Learn what not to do in an interview. Treat this job search as your full time job. Sure, it would be fun to take a couple weeks off to rest and relax, but you can’t afford it. The faster you find a job the less you have to use of your severance money, making what’s left a nice bonus towards your financial turnaround.

When employed again use any remaining severance and emergency fund stockpiles to pay off debt, down to the original amount of your beginner emergency fund. Now is not the time to blow money to celebrate. If anything, this experience should have taught you a valuable lesson - there is no such thing as job security. In an ever-changing global economy filled with uncertainty, any work could dry up in an instant leaving you unemployed. There is no better time to get out of debt, build your emergency savings and work towards financial independence.

5 ways to survive a layoff

2008-11-18T08:14:00.000-08:00

* The key to staying valuable to your employer is really no different than in good times, but critical in slow economic times.
* Take initiative to learn on your own. There are so many developments that it's important to invest your time in your career by getting the latest technology training even if you must pay for it and do it on your own time.
* Be flexible in accepting work assignments. Be willing to accept responsibility for others who have been laid off and take on some new responsibilities because there is no budget to hire.
* Be a problem solver: Don't complain about the difficult circumstance the economy may bring upon your company. Look for solutions to problems.
* Know your business and how your role impacts customers and the bottom line. Even though you assume a specific IT role within your company, you must be able to think like the CEO and see the big picture.

Survive Layoffs

2008-11-18T08:10:00.002-08:00

Survive Layoffs - The Issue: Employment in the financial services industry is highly cyclical, creative a constant imperative for employees to be prepared to survive layoffs. During bull markets, when the prices of financial assets are rising, financial services firms expand and hire aggressively. With the slightest hint of an oncoming bear market, when the prices of financial assets appear to be starting a general, prolonged decline, financial services firms ruthlessly slash headcount and payrolls. It is not unusual to see employment in a given firm fluctuate by as much as 50% between market peaks and troughs.

A Case Study: Merrill Lynch was once nicknamed "Mother Merrill" and noted as a bastion of stable and sensible hiring practices relative to its industry peers. Before 1987, there was little need to prepare to survive layoffs. Since 1987, however, total headcount has twice hit lows near 40,000 and highs around 60,000, tracking market cycles. The 2007-08 downturn started with Merrill Lynch again at a high near 60,000 employees.

The Irony: In advising investors, both individual and institutional, financial services firms recommend against crazed buying in bull markets and panic selling in bear markets. They admonish investors to create long-term plans, stick to them, and not get caught up in passing hysteria.

In managing its own operations, however, the industry habitually fails to take its own counsel. Profits are monitored on a daily basis, and the slightest shortfalls from plan or from trend can create full-blown panic in the executive suite. Regarding personnel matters, both bull market hiring and bear market layoffs can be equally excessive. An inevitable consequence is that employee loyalty is generally low in financial services, even when compared to other industries. Additionally, productivity suffers as a result of the need for staff to plan how to survive layoffs.

Long-Term Personal Strategies: Per our discussions of changing jobs and redefining your job, prudence dictates that you structure your career to gain experience in a variety of functional areas. This will increase the chances that, if your current work area is targeted for force reductions, you have the skills and experience to make a transition to another area that is weathering the cuts, and thereby to survive layoffs.

Make a point of staying in constant contact with former bosses, mentors and colleagues who are in other areas of your firm, or who have moved on to other employers. Kept abreast of both the current opportunities where they are, and what the outlook appears to be. Given the mercurial nature of employment in much of the industry, you cannot afford to wait until layoffs are threatening before you plot your escape route. By then it is too late. Developing a good, ongoing relationship with a reliable executive search firm ("headhunting" firm) is equally valuable as a means to keep on top of hiring trends and to survive layoffs by hitting the exits in time, if necessary.

Short-Term Personal Strategies: In the spirit of better late than never, start working your contacts (see the prior section) immediately upon the onset of negative market conditions, negative profitability reports at your firm and/or rumors of force reductions.

Employment and pay in retail lines of business (those serving individual clients) tend to be much less volatile over market cycles than in institutional lines (those serving large companies, both inside and outside the financial services industry). Thus, if you are in an institutional area such as investment banking or securities trading, and depending on your career path and goals, you may consider a shift to the retail side when trouble is on the horizon.

Twenty ways to survive a layoff

2008-11-18T08:10:00.001-08:00

1. As you're being laid off, take notes

This can be difficult to do, because losing a job can be a very emotional experience. Nevertheless, while everything is still fresh in your mind, write down all the details you can remember. For example, I was told I would be paid for the full two-week pay period plus my remaining vacation and sick time. When my last check arrived, there were discrepancies. Having written notes helped me when I went back and reminded my former boss and the Human Resources folks of their commitment.

2. Take some time for yourself

Take a few days for yourself. A traumatic event has just happened to you, and you need to get over the initial shock before you jump into the fray to search for a new job.

3. Review the paperwork from the company that laid you off

You need to attend to several important things rather quickly. One is finding out how to file for unemployment. Another is determining how long your company-paid health insurance will be in force before you have to consider paying for COBRA insurance.

4. Update your résumé

This is something we should all do, but it doesn't always get the attention it should. I was told a long time ago that a résumé should be more than two pages with a maximum of three bullet points per employer. That may work in some cases, but not in all.

I have found that some recruiters and employers use software that counts how many times a particular word, such as Cisco, or a word describing a certain type of experience appears in a résumé. I can attest this is happening to a degree. During a previous job search, a recruiter had me rewrite my résumé just about completely to list specifically all the different types of Cisco hardware I had worked with. It was interesting to note how the callbacks increased after I did that.

You may find it necessary to keep more than one type of résumé, each tailored to the type of job you are pursuing.

5. Get a handle on monthly bills

Although I had a little money put by for a rainy day, I went through my recurring bills to see if there was any room for saving more. I found that by shopping around for automobile and homeowners insurance, I could keep the same coverage and reduce both bills. I had been thinking about doing this for a variety of reasons, but being unemployed helped push it to the top of the list.

6. Cut food costs

If you live by yourself, this will be easier to do. If you have a family, everyone will need to sit down and understand they will all have to help out until you can get another job. Not that I ate out a lot while I had a job, but I did eat out sometimes. When I was laid off, that stopped. The one treat I allowed myself each week was to stop by a local pizza place that made the pizza but you took it home to cook in your own oven. I made sure to take a coupon with me each week to take a couple dollars off the cost of the pizza.

I also shopped at my local Costco and bought the food I needed in bulk so I had to shop only once a month. Having a freezer make this easier to do. For example, I would buy a 3 to 5 pound tray of fish, which I would portion out into individual meals using a vacuum-sealing machine. Another suggestion: Buy several gallons of milk at one time and put them in the freezer. Pull one gallon out at a time, and it will still be good. I have been doing this for more than a year and have yet to notice a difference in the taste.

7. Look at health insurance options

Your company-supplied health insurance will come to an end. My former employer's health insurance ended a few days after I was separated from the company. Worse yet, I wasn't due to receive COBRA information until after my company health insurance had lapsed. Because my previous employer also had been processing my claims, I wasn't comfortable with it having any further access to my medical records. Doing a little research on the Internet, I found a single health-insurance policy from Blue Cross Blue Shield for half the price of the COBRA policy my former employer was going to offer me and with better coverage.

8. Check with your financial adviser

I have worked with an excellent person at Smith Barney for several years. Because I knew I might need to access my credit line to help pay bills, I wanted to give him a heads-up on my situation so he could be looking at other options to keep the use of the credit line as a last resort.

9. File for your income-tax return refund

Another thing to consider, depending on the time of year you are laid off, is to use your income-tax return as a one source of money for paying bills. I haven't been a fan of paying for electronic filing, but this year I did spend the money so I would get the tax refund a little sooner.

10. File for unemployment compensation

This is something I delayed doing a little bit -- partially because of pride and partially because I didn't anticipate job-hunting to take more than three months. As someone pointed out to me, you have earned this money and you should take advantage of it. In my case, filing was complicated because I had moved from another state in the previous 18 months. The unemployment folks go back that far in figuring out where someone should file for unemployment. That potentially had me talking with three states' unemployment departments. I spent several days on the phone with the two states that would be involved in my situation. As painful as it may be to deal with this part of your unemployment, the sooner you start, the sooner the money will come in in to help pay the bills until you get another job.

11. Check the job boards

During my job search, I looked at CareerBuilder, Craigslist, Dice and Monster. I found no job leads from Monster in my career area. Several of the HR folks I talked to during the process told me they used Monster very little, in part because of the higher fees the site charged for posting a job compared with other job boards, and in part because of the generally poorer quality of applications they received from Monster. I found some new job-postings on Dice, but with a significant number of jobs cross-posted on other boards, I didn't find Dice to be a significant source of potential job leads. One source I wouldn't have thought to check was Craigslist. More than one recruiter told me he had good results from posting jobs on Craigslist. Set aside time each day to do this.

12. Make the job boards work for you

Dice has a feature where you can make your résumé searchable by companies and recruiters with a position to fill. I got some calls from that. CareerBuilder recently followed suit. Dice lets companies and recruiters repost a job every day so that it looks new, but in some cases this makes identifying the jobs a little harder. Turn the tables in your favor by making changes to your résumé periodically so that when it is searched it will show up as new or changed; this could get you looked at by a company or recruiter that might have passed you by the day before.

13. Prepare for the interview

One thing I have done when preparing for an interview is to research the company, as well as the companies, sectors and industries it serves. If it is a publicly listed company, read some of its press releases from the the past quarter or two to see any changes that have occurred and new directions it is heading in. The responses I received from several companies indicate it makes a good impression that you are interested in finding out about the company before an interview. It may seem like a small thing or something that you should do anyway, but there seem to be quite a few people looking for a job who don't do this.

In addition, have several copies of your résumé with you at an interview. This becomes even more important once you see your résumé as the client or recruiter does after they have downloaded it or printed it out from the job-board application: The formatting is pretty much gone. To make matters worse, the résumé's paragraphs or bullet points will look like a series of poorly written, run-on sentences that may cause distinctive or unique information about you to be overlooked.

14. Deal with recruiters

I encountered a couple of recruiters who would give used-car salesmen a bad name, but as a general rule, I found them pretty decent to work with. Several positions I was approached about were not on the job boards and sometimes were from only a single recruiter. The trick I learned was to identify the same end-job when it came from different recruiters. One situation you want to avoid is having more than one recruiter pitching you to the same client for the same job. Most recruiters usually will tell you early on who the actual end-client is.

15. Accept help from family

Your pride may make it hard for you to accept help, but keep in mind that your unemployment affects them to a degree as well. Depending on their ages, your unemployment may be a new thing to them. There was a time -- unfortunately long-gone now -- when the company you first worked for was the only company you worked for in your entire career. How much help you accept from family is something you will have to decide. Look at it this way: Whatever help they do give you is that much less you will have to spend for food.

16. Keep good records

This suggestion came from a letter from the unemployment department telling me I would need to provide some basic information. I set up a spreadsheet in OpenOffice with three tabs. At the first tab I kept track of the jobs I had applied for by date, source of the job, how the job was applied for, company name if known, job name, contact name and job number if provided. At the second tab I kept track of the recruiters I talked to; HR folks I had contacted for the jobs to which I had applied directly; and anything else, such as job fairs I attended. This information was helpful when I was audited by the unemployment folks to make sure I was looking for another job. At the third tab I recorded when I filed my unemployment claim each week, when I received the check, and the check number and when it was deposited.

17. Get your personal records in order

When you accept a job offer, one of the things you will have to deal with is the I-9 form that proves you are allowed to work in this country. If you haven't seen the I-9 form lately, get a copy so you can see what documents you will need. If you can't find your Social Security card, now would be an excellent time to order a replacement. This will take several weeks to process. The sooner you receive it, the sooner you will have it ready to produce when you start your new job. Another document you want make sure you have, even if you don't need it for the I-9, is a copy of your birth certificate. This might take a little while to get. I didn't know until recently that, depending on when and/or where you were born, there are two types of birth certificates -- one the hospital does and one that's done when the birth is registered with the local authorities. You will want to get a copy of the certificate on file with the local authorities.

18. Don't wait for the phone to ring

This may be one of the harder things to do. Keep in mind that recruiters and HR types move at their own pace, which can be very slow. When you first apply for a job, it could be several days or more before you get the first contact. Waiting for the phone to ring will have you climbing the walls in short order. Sometimes you will get a call within hours of applying for a job, but expect that to be the exception. There are always things you can do while you wait for movement on the job front, and some of them may be done at little to no cost -- that little bit of touch-up painting you have never gotten around to, or the trimming around the yard that always needs to be done. You need to stay active -- don't just sit around and watch the clock move forward.

19. Get out of the house at least once a day

At some point you will run out of things to do around the house or will simply need to get out. There will be the occasional job fair, but that won't take a large amount of your time. You can knock on the doors of companies that you would like to work at, but with the price of gas hovering around $4 a gallon depending on where you live, that can be an expensive trip to make for an unknown return. Do some things you enjoy, such as going to a museum or sports game. The main thing is to get out to keep from getting cabin fever.

20. Never give up

Don't leave any stone unturned. You just may find that a company that today passed you over in favor of another applicant may come back to you when that person leaves to move onto greener pastures. I never would have thought that could happen, but I have seen it happen twice in the past year.

Nutter is an IT executive in Kansas City. He is also one of the editors of Network World's IT Asked & Answered. He can be reached at nww@networkref.com.

How To Survive a Layoff

2008-11-18T08:08:00.000-08:00

Here's How:

1. Keep getting up in the morning. You will find another job. Remember, you have skills!
2. Contact your state unemployment office immediately to get the typical waiting period out of the way of your checks.
3. Update and polish your resume.
4. Start searching for a new job right away.
5. Submit your updated resume to several job sites, to let employers come to you.
6. Apply to receive job notification by email at job sites that offer it, to let the jobs come to you, too.
7. Contact your references to let them know you're back in the job market and counting on them.
8. Ask your ex-boss to write a recommendation letter that also explains why job loss wasn't your fault.
9. Practice interviewing while you have the time and to keep your confidence level up.
10. Attend outplacement seminars if offered.
11. Consider temping until you find a permanent job.

Tips:

1. You might be able to negotiate a better severance package with your HR department. Ask them about jobs, too. There might still be mission-critical openings to which your skills transfer.
2. To avoid worry and depression, keep your mind busy and make yourself feel useful by working on your house, car, yard, hobbies, etc.
3. It could be the best thing that ever happened to you. For example, now might be a good time for that career change, training or self-employment you've been contemplating, but never had the time.

Layoff - The Worker Adjustment and Retraining Notification Act (WARN Act)

2008-11-18T08:03:00.000-08:00

National Summary

The Worker Adjustment and Retraining Notification Act (WARN Act) provides protection to workers, their families, and communities by requiring employers to provide advance notification of plant closings and mass layoffs. Advance notice is designed to provide workers and their families some transition time to adjust to the prospective loss of employment, to seek and obtain alternative jobs and, if necessary, to enter skill training or retraining that will allow these workers to successfully compete in the job market. The Act also provides for notice to state dislocated worker units so that dislocated worker assistance can be promptly provided.

Not all plant closings and layoffs are subject to the Act, and certain thresholds must be met before the Act applies. WARN Act violations can be expensive, as damages and civil penalties can be assessed against employers that violate the Act. There is also a host of issues that employers must consider in connection with layoffs, such as the possibility of discrimination suits, the notice requirements for and the cost of healthcare continuation coverage, and whether to provide outplacement services and/or severance pay. Employers may also want to anticipate rehiring laid-off workers and taking advantage of government training and retraining programs.

layoff - It's the end of one job; focus on a strategy to get another

2008-11-18T08:00:00.000-08:00

Each person deals with job loss differently; some may suffer from clinical depression or even become suicidal It wasn't supposed to be this way for the 34-year-old director of a Bangalore-based telecommunications start-up. He planned to buy a flat with his savings. The firm was supposed to go on to become a success: and providing for his homemaker wife, two sons and his retired parents would never be a problem.

Then came the layoff.

Now he is turning to a bank for a loan. Applying for a new job. Strategizing how to stretch his savings. Friday was his last day of work at the 30-member company. In an effort to lower costs, it had decided to shut down the marketing division and eliminate its staff of six.

Dealing with it

Every person deals with job loss differently, depending on one"s personality and coping skills. Psychologists report some patients suffer from clinical depression, anxiety disorder or even become suicidal after experiencing a job loss. This mostly happens to men who are sole bread-winners in the family.

Layoff

2008-11-18T07:43:00.001-08:00

Your employer likely has the right to terminate your employment at anytime though a layoff. That's because employment is presumed to be "at will" in the U.S. It's also because employers have the right to protect themselves financially through layoffs.

But, you have at least some employee rights regarding a layoff. For example, your employee rights might entitle you to collect state unemployment benefits and purchase COBRA extended health insurance benefits at group rates after you're laid off.

Your employee rights also protect you from your employer illegally firing you under the guise of a layoff. Read Wrongful Termination for information about the types of employment discharges that might be illegal under the guise of a layoff.

Lastly, your employee rights might require your employer to give you advanced notice of a mass layoff, so that you may at least prepare financially to lose your job while searching for another.

Under certain circumstances, the Worker Adjustment and Retraining Notification Act (WARN Act) requires employers to give affected employees up to 60 days of advanced notice for mass layoffs or plant closings.

Under the WARN Act (or an equivalent state law), your employer must continue to pay you and grant you the benefits to which you're entitled through your advanced layoff notice period, whether or not your employer requires you to work through it.

However, if you start a new job during your layoff notice period, under the WARN Act it's the same as resigning from your current job. If your employer discovers that you've started a new job, your employer likely will not owe you for the remainder of your layoff notice period.

If your employer fails to honor the layoff requirements of the WARN Act and you wish to seek damages, you might have little choice but to do so through a lawsuit (or your union). Although the U.S. Department of Labor administers the WARN Act, it has no power to enforce it. However, district courts do. Consult an attorney about a WARN Act lawsuit.

Final pay laws vary by state, But, generally, employee rights under such laws require employers to issue final paychecks immediately or soon after employment ends, such as by the next regularly-scheduled payday after a layoff date.

Although your employer might offer severance pay anyway, your employee rights do not generally entitle you to receive it for a layoff, unless you're working under a collective bargaining agreement, or an explicit or implied contract that indicates otherwise. The pay you'd receive through the end of your layoff notice period under the WARN Act is your regular pay, not severance pay by definition.

Contact the relevant state labor department or consult an attorney for more information about employees rights regarding a layoff.

How To Lay-Off an Employee

2008-11-18T07:41:00.000-08:00

The Company that Did it Right
In January of 2001, I was laid-off from full time employment by IS² Inc during a slow period (known as the dot-com dot-bomb) in which they didn't have need for the work that I was doing.

This could have been a major disaster in my life, but the company did some wonderful things for me that cost them nothing (and incurred no liability for them) and made all the difference to me.

I am providing this information here for other employers who might be in a similar position and would prefer not to have to lay-off employees, but if they must, want to do it in the way that will hurt employees least.
How to Do It Right

* They told me it wasn't my fault, that if they had a choice they would be keeping me.

This will always make an employee wonder: why are they keeping Ralph and letting me go? But the other things they did made me realize it was just a matter of numbers and immediate business decisions and not because they valued me less.

* They didn't rush me to pack up and leave. Of course, I did leave in a reasonable amount of time, but I didn't feel as if they were standing over me waiting for me to get out.

* They told me that if the economic situation changed that they would be happy to rehire me, and they backed it up by making sure that the termination agreement had no clause preventing me from reapplying to them.

* They supplied me with a beautiful letter of recommendation, which helped me land my next job.

* During the period that I was unemployed, they encouraged me to keep in contact with them. Okay, I know that this is highly unusual these days, but wouldn't it be nice if it wasn't? Too many times employers and supervisors act like they never again want to hear the names of people who no longer work for them, even if that employee was laid off.

Why Do it Right?
Simple: company morale. The other employees see what is happening to the person who is being laid off and know they could be next. There are two ways a company can handle this:

1. Encourage the remaining employees to believe that the employee who was laid off did not meet company standards. This will motivate some employees to work harder or smile more (whichever it is the company wants) by fear; but those who worked closely with the employee who was laid off may not be fooled. OR
2. Allow the remaining employees to see that the company is doing the best it can for the employee who was laid off. This shows the remaining employees that the company they work for is a company that knows that loyalty is a 2 way street.

Why is the second choice better? Because ex-employees like me will continue to carry that good will, into our neighborhoods, into our next job, and into any further contact we have with others who are or could be in contact (future employees, clients, colleagues, customers) with our former employer.

Laying Off Employees

2008-11-18T07:24:00.000-08:00

Laying off employees is never pleasant. Most entrepreneurs hope they never have to conduct layoffs but occasionally it's necessary. If you find yourself needing to layoff employees, make sure you do it right.

One of the most devastating decisions you may have to make as a small business owner is the decision to layoff employees. No matter how you dress it up, this decision will have significant financial and emotional consequences for everyone involved.

Should you be forced to go down this road, your goal is to design and implement a process that minimizes the impact on the employees who are being laid off, as well as those who will remain with your company.

To do this, you will need to carefully follow a well-thought out plan.

Step 1: Be prepared

The right time to prepare the materials and information you will need for the layoff is before the layoff is announced to your employees. This means preparing the official notification letters, severance package details and documents, and job placement service arrangements ahead of time.

The upside of advance preparation is that your employees will have the information they need to take care of themselves and their families as soon as possible. It also conveys to your staff that you have carefully considered the consequences of the layoffs, and are doing everything in your power to take care of your employees.

Step 2: Call a meeting

Delivering the news to your employees is not a pleasant experience. However, you’re the boss, and it is your responsibility to inform your employees about the layoffs firsthand. Do not delegate this responsibility to an underling! If you do, you will lose the trust of your remaining employees and your business will suffer the consequences.

The key to informing your employees about layoffs is to prepare what you are going to say in advance. Help your employees understand the rationale behind the decision. As much as possible, try to explain what they can expect going forward, including whether or not the laid off employees may be rehired at a future date.

Your employees will react in different ways. Some will be angry. Others may be sad. In the worse case scenario, some may even be tempted to react violently. Be prepared to handle any and all of these reactions. Reassure them that you will do whatever is necessary to help them recover from the loss of their job.

Step 3: Take care of yourself

Many employers neglect to consider the impact layoffs will have on them personally. The fact is that you cannot avoid being affected by layoffs. After all, these are faithful employees and even friends who are losing their jobs through no fault of their own.

As a result, you can expect to endure feelings of anxiety and guilt. But through it all, keep in mind that the layoff is not personal. It is a business decision that is necessary to ensure the long term viability of your company, a decision that will provide job security for your remaining employees.

Find someone to talk to before, during, and after the layoffs occur. Some entrepreneurs rely on a support network of other entrepreneurs to help them get through this difficult time. Others turn to family, friends, or even counseling professionals.