I’m not sure whether this will come as a shock to people or if they’ll get mad about it or if they will simply say, “Why sure… that’s the way it works.” We all know that when the economy is rock ‘n rolling and we’re all making a lot of money…or think we are, we have a tendency to put up with subpar performance on the part of a lot of employees. When we are making money we overlook the challenges and, sometimes outright terrible performance on the part of some of the people that work for us or our companies. It’s the old saying that, “High tide raises all ships.”
When times get tough, however, most hiring authorities, most managers and most companies know that they have to trim their expenses to make a profit or even stay alive. The money that we pay our employees and on their benefits is the largest expense that most any company has. So, the first thing they will want to do is to cut back on the overhead of employees.
I heard about this at least four times this week from different managers and owners of companies. One manager told me that he was told to get rid of at least 10% of his budget for people, so he laid off the ones that were the highest paid. His decision had nothing to do with performance, longevity with the firm…nothing other than the highest paid folks. Another hiring authority was almost gleeful that he was getting a chance to let people who he had hired, but that he didn’t like and he didn’t think that they were all that good. He said, however, that when they were making a lot of money…four or five months ago… he was told that he could not let them go. Another hiring authority was told to cut four people from his 10 person department and told at the same time that by September or October, he could replace them. Corporate was simply looking at a budget and didn’t really care about the lives of the people he was going to let go. It didn’t matter to them who it was as long as he got rid of a certain percentage of his payroll even if he was to hire other people to take their place in October. Some of these people had been with him for five or six years. It didn’t matter to corporate.
And then there is the idea of “furlough.” Since 1973 I’ve never heard that term used in a business setting. In my very short stint in the military I heard it, but not in business. The common practice of it is to pay benefits for the people that are “furloughed” but not their salaries. I have heard many times in the last few weeks, hiring authorities telling me that they will probably let those people they had to “furlough” go anyhow. And I’ve had quite a number of candidates tell me that they’ve been “furloughed” but if they can find a better job during the “furloughed” time they would leave in a heartbeat because they still feel like they’ve been “let go.” Either way, it doesn’t seem like either the employees who are being “furloughed” or the employers who are doing it have much faith in those folks being part of their company and employed there by the end of the year.
When times get like they are, companies have a chance to purge, what they consider to be, marginal employees. No matter what they say to the world, they are trimming people who they think they can replace with better people. I heard it this week from an employer who said, “Over the past few years there haven’t been as many good candidates as I would’ve liked. With so many people out of work, I’m going to get rid of some of the folks that are here and upgrade. What do you think?” I explained to him that I really didn’t think he was going to find much better talent than he already had. He claims that there had to be, with so many people in the job market, better people than some of the ones he had. Well, perception is reality!
We had another client who actually made an offer to one of our candidates for a regional director’s job two weeks ago, but can’t get corporate to issue an offer letter because they’re going through lots of layoffs. They don’t want to be perceived as hiring people at the same time they are laying a lot of people off. They’ve told our candidate to just hang on for a few more weeks. Maybe he will, maybe he won’t. The kind of job he is getting from them is really hard to find so, likely as not, he’ll be available for quite some time.
If this all sounds confusing, it is. Free enterprise is a mess. And, when we go through very difficult times of doubt, uncertainty and fear we see lots of this kind of stuff happen. Just as some companies are welcoming the fact that they get to lay off what they consider to be “dead wood,” we have others that are telling us that this is the best time to find really good talent. I will have to admit that the present condition has produced a lot of extremely good candidates who have either been laid off, furloughed or they are looking to leave where they are because their company is having lots of problems. Smart companies are hiring when others aren’t.
Now, as I’ve mentioned before, this is the seventh recession that I’ve seen. I will admit that it is really hard to care and feed all of the company’s employees when everyone is afraid of the economy and fearful of making a profit. Let’s face it, none of us really know how this is going to play out. We know that we’re going to get through it, because we always figure out how to do it. We just don’t know how long it’s going to take and all of the collateral damage it might cause.
Tension and emotions do run very high and that’s very unfortunate and saddens us all. I had a candidate I interviewed a few weeks ago write a Google review that I was “useless.” He claimed all I did was interview him and did nothing else for him and he was mad. He has been selling real estate for the past three or four years and has been out of the technical marketplace for a long time. He has no recent track record in technology and no recent contacts. I explained to him when I interviewed him that it was going to be very hard for me to find him an interview, simply because he has been out of the technical sales arena for three or four years. I feel his pain. He is simply frustrated and angry at trying to find a job. I really feel badly for him, but I don’t write the rules of what our clients want. If our clients are going to pay a $15,000 or $20,000 fee or more, they are going to look for a candidate who can produce for them immediately. And in this market, there are hordes of candidates with just about exact experience in anything our clients want them to have. Three or four year old experience doesn’t help them when they have plenty of candidates to choose from who have immediate experience.
It’s no wonder everyone is afraid. But the best way to overcome fear is to take massive action. We have to pray, put one foot in front of the other and work like hell to get out of this challenge.
