In a new story, The Wall Street Journal reports today that companies that take a limited and more-targeted approach to layoffs tend to do better in economic recoveries than those that slash employment sharply and across the board.
"You can't shrink your way into prosperity," Wayne Cascio, a business professor at the University of Colorado, Denver, told the WSJ.
The current recovery will test those findings because many companies made unusually steep and rapid layoffs during the recession that preceded it. Gannett dramatically reduced employment between 2007 and 2009, eliminating 24% of its global workforce.
Earlier: Gannett employment plunged 16% last year
Wednesday, May 05, 2010
6 comments:
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Duh. Should we be surprised that judicious cuts are better than across-the-board reductions? The problem Gannett now faces is that it let go a lot of its talent who kept the papers going and wrote or edited stories people wanted to read. I think the absence of these people is noticeable across-the-board in very weak coverage, writing and editing. It is hard to deny that senseless buy-outs of older higher-salary staffers and layoffs of others weakened the product. There's no going back. Those let go will not be rehired. It doesn't do much good to say now that there were other approaches that should have been tried.
ReplyDeleteGood WSJ report. Gannett has slashed to the point that most newspaper properties can do little more than produce a basic product with a small newshole. As advertising picks up, pages will increase and there will be more newshole -- it will be difficult to do that in any thoughtful way. Also, there aren't enough experienced reporters left to do good investigative and project reporting, for the few papers that still do that sort of thing. Some exec editors will demand it anyway, but the product is not likely to be good.
ReplyDeleteThere were people saying all along that other approaches should be tried, but they weren't listened to. Perhaps going forward, some papers will add positions here and there as conditions improve. At some point, management has to re-invest in the long-term health of the papers, if for no other reason that when the next downturn comes, there has to be something left to cut.
ReplyDeleteBlue collar workers have had this "cookie cutter" policy done to them at every newspaper consumed by Gannett. What has been happening for years behind the scenes is now happening across the board to white collar workers. And if you look closely enough you will notice that Gannett, in perfect Orwellian tradition, is now on a kick of homogenization or "Same as" as they put it, of all their sites. Consolidation, cannibalism and homogenization of their product, in all aspects, is Gannett's answer to pressures in their corporate world, not necessarily to compete with digital, ie: the internet (although that is what they tell us), but to regain the quick, easy profit they once knew.
ReplyDeleteYep. Anything to keep profits up. By the time the folly of this approach is clear, most of the managers responsible will be long gone.
ReplyDeleteToday's corporate businesses are structured so that upper management doesn't need to worry about long-term viability. Salaries and bonuses are so lucrative that a CEO who keeps a job for five years has no worries. If he runs the company into the ground, that's a problem for the employees and whoever takes over after him.
ReplyDeleteIn most cases, CEOs who milk a company for all its worth for five or 10 years and then leave them in ruin, will do better for themselves than those who implement a solid business plan of solid and steady growth.