Your Workforce by Roger Herman

Coping with Fewer People

During the economic downturn, employers cut costs. Then they cut costs again, and again. They lowered personnel costs by reducing their number of employees. Then they laid off even more people. When it looked like they could not reduce their payrolls any further, they sent still more people away.
Result? Most companies are operating with the bare minimum of employees.

This slow economic period has given new meaning to “lean operation.” There is no redundancy; there are no extra people. If someone is absent, work doesn’t get done. The people who are fortunate enough to still have jobs have to work harder, endure more stress, and work longer hours. Supervisors expect more from their employees. Using technology and improved work processes, these dedicated employees have pushed productivity to record levels.

Employers have become creative and cautious at the same time. They continually seek new ways to get things accomplished, and they challenge themselves to focus only on the tasks that are necessary. Executives are very careful these days, delaying decisions and hoarding resources. Many companies appear to be in a holding pattern.

This situation was already in place, with companies operating bare-bones levels, even before the war in Iraq stimulated the mobilization of 216,811 employees into military service. Now employers are even more challenged, and their situation is complicated by a moral need to care for the families of the activated employees.

Employers are bringing in temporary workers, outsourcing work to other firms, and extending the time involved to complete jobs. Some companies are having lunch delivered, so people don’t have to leave in the middle of the workday. Others are arranging childcare, so parents can work longer each day.

The stark reality is that many companies will be forced to hire more people, stretching resources that are already thin. The new employees may view themselves as temporary, reducing their motivation to perform at high levels.

When the economy improves, even a little, employers will be recruiting again. A few more people will ease the strain, but in many companies, a comfort level will not be felt until 2004.

Roger Herman is owner of The Herman Group, Greensboro, NC and is a specialist in employee retention.

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