Tuesday, February 10, 2009

What if the layoffs are bullish?

A major chicago institution enjoyed record growth year after year, but during this period, the Tribune carried story after story of mass layoffs at that exchange. I asked a staffer why they kept getting rid of people, with their net employment continually rising, and he explained that layoffs were a golden opportunity to fire pesky and litigous employees, and were necessary in an age of deep pockets and lawsuits. Managers would maintain lists of dispensible people, and -- when the summons for a layoff would come -- they would use the list to fill the quota.

In other words, they practiced a Welchian culling without stigmatizing the bottom ten percent, and since that time, I have viewed news articles about "layoffs" with suspicion. With that said, there is something more happening when the economy sheds a half million jobs. Could it be that companies are positioning themselves to take advantage of Obama's abandoned tax credit for new employees?


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