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I am not saying the whole thing is a sham, but layoff numbers do not directly translate into a like increase in the unemployment rolls. The numbers need to be taken with a grain of salt.
The rest of it is what I have seen in real practice, both by single and family people of multiple levels in organizations.
I am not saying that the company is not eliminating as many pr more jobs in a given market as they claim, merely that a good percentage of people whose jobs are eliminated do not wind up unemployed.
I know several people in the position you stated in my workplace. They manage to do it. A single mother is doing it. It's hard, but they manage to make it happen.
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Joined: Feb 2003
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Hard-core CEG\'er
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Quote:
I am not saying the whole thing is a sham, but layoff numbers do not directly translate into a like increase in the unemployment rolls. The numbers need to be taken with a grain of salt.
Likewise the numbers work the other way as well.
Speaking as the man who often is tasked to go into companies and "right-size" them, companies will often understate their layoff numbers considerably.
It's almost never good for a company to announce layoffs. Any cost-savings from the layoff can be immediately rescinded by a drop in stock price. So, in order to combat this somewhat, companies will figure in all those things that you talk about into their number -- Retirement, Attrition, Early-Retirement, Employees looking elsewhere when they feel their job's at risk, etc, etc.
If I need to get rid of 50,000 employees, but know that 25,000 are going to leave in some way or another in the next year anyways, I'm not going to announce that I'm laying off 50,000 employees, I'm going to announce I'm laying off 25,000; I just won't replace those other 25,000.
If it ends up being 30 or 35,000 that I need to give pink slips too because they didn't leave as expected, so what?
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Joined: Aug 2002
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Originally posted by sigma:
It's almost never good for a company to announce layoffs. Any cost-savings from the layoff can be immediately rescinded by a drop in stock price.
My company stock took a big increase on announcement of layoffs. My experience is that wall street loves when a company lays off and saves a bunch of money. Reducing overhead and operating expenses is almost always good for stock. I believe it is the other way, they announce layoffs say 50,000 employees (We reduced from 250,000) when they really retired some with pensions (given an early retirement package), some were attrition, etc probably about half of them in all. In fact, they hired quite a number back as "outside consultants" who were not technically employees but private contractors.
By taking them off the "payroll" and having them be an "expense" instead, they really exaggerated the layoffs.
We outsourced a lot of work (to foreign places like North Carolina and Georgia) where the "new" companies supplying us with materials hired quite a few of the laid off employees. Of the 50000, half were leaving anyway, and i am guessing because I don't have the exact numbers, but I bet "only" 5,000-10,000 actually had to go on to find another job. Not good, but not as bad as the original number sounded. Interestingly enough, the bulk of the people hit the hardest were the union people. Many white collar people can bring their skills to other fields easily. The union force skills are narrow enough that sometimes we were the only game in town. If you are a "Tube Expander" for heat exchangers, there aren't as many opportunities as an Office Manager, for instance.
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UPDATE
Ahhhh HAHHH! I just learned how Kerry will create 10,000,000 new jobs he has been promising. Are you ready....
DO NOTHING DIFFERENT!
Thats right...new Wall Street Journal report is predicting 177,000 new jobs a month created for the next year. Which is 2.1 million jobs a year, times 4 years is 8.4 million jobs. Using the standard politician round up rule...10,000,000!
Rock on Kerry...you da man!
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