With many people looking for a job right now, it seems employers would be in the driver’s seat when working with their employees.
But with workers concerned about 401(k) reductions, benefit cuts and layoffs, now is just as important as any time for companies to show commitment and investment in their workforce, industry leaders say.
James Guthrie, professor at the School of Business at Kansas University, says retaining a business’ existing workforce is important to a company’s success.
“Layoffs can often lower performance,” Guthrie said. “No matter the type of business, when termination rates increase, operation performance decreases.”
Guthrie said that when employees leave, a business loses institutional knowledge that can only be gained through years of experience in a job. Layoffs may temporarily cut labor costs, but companies need to be aware of the value of experienced workers and the effect it can have on the future of the business. Guthrie says major companies, such as Southwest Airlines and Lincoln Electric, have realized this and have worked to avoid layoffs.
“They may not be guaranteeing jobs right now, but these companies are offering employment security,” Guthrie said.
Guthrie said companies may also choose furloughs or attrition instead of large layoffs. He said businesses must understand layoffs can also bring voluntary termination because employees suddenly feel nervous about their job security. Voluntary termination could result in the company losing their most experienced and valuable workers.
“Companies need to preserve a sense of commitment,” Guthrie said. “If people feel like they have a future with a company, they’re more likely to stay.”
Westar Energy spokesman Nick Bundy says the utility’s officers have been forthcoming about the state of the company. As a result of cooler-than-usual temperatures last summer, the company had to lay off 21 employees in the power marketing department.
“The layoffs did create a sense of insecurity,” Bundy said. “But our officers were quick to reassure us that layoffs were truly a last resort.”
Bundy said the executive director of finance and CEO frequently have meetings to clear up employee concerns and questions. He says Westar offers unpaid time off for some employees in an effort to avoid cuts in 401(k) matches, ending incentive increases and layoffs.
Besides ensuring job security, employers need to build upon the strengths of a diverse group of employees.
Jay Pryor, a Lawrence business consultant, says current society is unique because it has four generations actively participating in the workforce — the G.I. generation, baby boomers, Generation X and Generation Y. This creates a difficult situation for employers when trying to please each group and apply each group’s skills adequately.
Pryor says employers need to strive to value all groups. The G.I.s and baby boomers bring a strong work ethic, level of maturity and reliability, and years of experience that Generation X and Y don’t have. Pryor says because Generation X and Y workers grew up in a fast-moving, instant-gratification society, they are task-oriented and fast learners who stay on top of trends.
Bundy says Westar’s linemen are overwhelmingly in the baby boomer age group. Once a year the human resources department puts together a “lineman boot camp” hoping to interest younger generations in becoming a lineman, as well as using the opportunity for current linemen to share their years of experience.
“It’s a challenge to reach the younger generations in that area,” Bundy said. “But we want to ensure experienced linemen for our future that have learned from the employees we have now.”