Archive for the ‘Economy’ Category
It started quietly. Rumors of ominous portent spread through the office, spoken in solemn whispers. But you paid no heed. You just kept on working.
The first to go was one of the IT staff. Then another went missing. An executive left with nary a word. One accountant bolted for the door, desperately muttering something about “Grad School.” All that was left were a few dusty outlines on their desks, and some stale, half-eaten cake.
Suddenly, scores of people disappeared. All around you, one after another, coworkers were summoned away from their desks and were gone. A few emerged only for moments, visibly despondent as they tearfully clung to one another, and then never to be seen again.
Now you’re alone. Much of your department has vanished. And, worst of all, you’re saddled with their workload…
The years since 2008’s economic meltdown have been taxing and, at times, bleak for professionals. For those who kept their jobs, the realities of the “Great Recession” meant watching others lose their jobs, taking up overwhelming responsibilities, and facing a discouraging possibility that there may be no end in sight. It can seem like you’ve survived an atomic blast.
But, if you’ve studied thoroughly in preparation for these apocalyptic times, then you know there are ways to survive, even get by comfortably. Here are a few “End of the World” strategies you can apply at work.
Where the living envy the dead
The greatest blow has been to morale. After all, we lost our friends, our neighbors, our collaborators, our happy hour companions. And while the value of your work may have spared you from layoffs, you were perhaps left questioning if your career was still worth it.
Experts call it “Layoff Survivor’s Guilt.” For companies that suffered heavy cuts, human resources departments reported declining company loyalty and esteem. Job stress has since been on the rise, and so too has a sense of inability and remorse.
It’s up to employers to preserve unity amongst remaining staff. Following layoff rounds, employees should demand open communication from leadership about the state of the company and the road ahead. Group activities are also vital to rebuilding camaraderie; for instance, managers can organize outings to roam the desolate streets and scavenge for dry Post-Its and trophies in the abandoned offices of felled competitors. (Remember to wear your radiation suits!)
And for those who regret having survived while others got the ax: Fallen friends are still friends. Stay in touch via Facebook and LinkedIn, maintain contact, and remember them when news of an opening crosses your desk. You can benefit as well—the unemployed are always the first to know about free cupcakes and discounted manicures.
(As a point of etiquette, avoid griping to them about work—you risk prompting bitter retorts of “At least you have a job …” Or perhaps they’ll have gone cannibal, and hunt you for your delicious, employable flesh.)
“I had so much time…”
On the other hand, some less sociable professionals might welcome the solitude and peace of mind. Like an idyllic beginning of a Twilight Zone episode, just before the ironic twist. Now that all the chit-chat is over, you can go about your work undisturbed.
But not so fast. Without the others, management expects to “do more with less.” The “less” being you, laboring a whole lot more.
Should the increased workload prove too much, take a stand. Make it known that doing the work of two—even three or four!—people should mean being compensated accordingly. Were this truly a post-apocalyptic hellscape, it might entail increased food and gas rations; in reality, it’s worth perhaps a 6 to 8 percent salary hike.
If that can’t be done, or if the promise of greater pay won’t ease the burden, then remember that companies are still hiring. Even with a ratio of 4.6 workers competing for every one job, you have an advantage (albeit an unfair one): You’re a survivor. Employers give greater value to applicants who kept their heads above water throughout the last years’ tumult; some outright shun unemployed candidates like infected mutant hordes.
Of course, these are just a couple of the scenarios to be explored. In the spirit of Halloween, we encourage Vault readers to join in. In the comments below, tell us some of the “apocalyptic” circumstances you’ve encountered since the recession. We’ll mention the best ones on our Facebook page!
— Alex Tuttle, Vault.com
The recession ended in June 2009. Did you notice? Chances are you probably didn’t—especially if you’ve been looking for a job. The bad news: things aren’t likely to get much better any time soon; current economic growth rates mean the unemployment rate will do well to drop by much more than a single percentage point by the end of 2011.
All of that is likely to continue reshaping the employment market, and will affect everything from your ability to conduct a salary negotiation to the pace at which you can expect to climb the ladder—or even get on it in the first place.
So what’s a job seeker to do? Vault’s industry and career experts put their heads together and identified a number of key trends that will affect careerists over both the short and medium term.
1. Doing more with less
In season five of the brilliant HBO series “The Wire,” the tight-belted, high-waisted head of the fictionalized Baltimore Sun declares, upon announcing a paper-wide job cut, that “we will simply have to do more with less.” It’s a quote that could serve as a template of companies both large and small in the post-recession era. After sacking thousands of employees in order to cuts costs, pummeling employee morale in the process, managers focusing on the bottom line will be hesitant to hire more bodies in order to explore more avenues of business, even when profits begin to pick up. Instead, they’ll simply turn to their existing employees, put a cool hand on their shoulders, smile, and ask them to take on increased duties.
2. Held back by housing
The recession may have ended in June 2009, but a little over a year later, The National Association of Realtors reported sales of previously occupied homes plummeted 27 percent in July 2010, the worst showing in 15 years. So, despite the good news, unemployed job seekers struggling to pay their mortgage still have fewer options for their job search. For them, it’s either find a job where they live or accept a job elsewhere, relocate and add on the extra expense of paying rent while they wait for their home to sell.
3. Choose your education carefully
It’s a truth universally acknowledged that applications to school surge during a recession. There are no jobs, so why not get more training and make yourself a better candidate when there are jobs? Makes sense, right? In the past two years, prospective students applied to graduate schools in droves; particularly to law, business and health services degrees. While health care is one of the fastest growing industries and will likely be able to handle the influx of new graduates, the law, finance and consulting industries will not. It’s unlikely, however, that this will deter prospective students from applying this fall—and next.
4. Age diversity
An aging workforce is going to continue to be a big challenge for employers, who increasingly prefer to cut costs on training for new positions. Compounding this is the fact that people are delaying retirement because of the recession. While gender and racial discrimination will remain critical concerns, age diversity presents a new challenge for the corporate world.
5. The finance industry
Don’t let the National Bureau of Economic Research fool you. Although GDP might have hit bottom more than a year ago, and we’re technically in an expanding economy, the US still looks very recession-like to the record numbers of men and women out of work, as well as to those still employed. And nowhere does the immediate outlook worse than in finance.
Hedge funds are currently experiencing their worse year on record, collectively growing assets by a mere 1.7 percent thus far in 2010; and Merrill Lynch recently estimated that as many as 20 percent of hedge funds could shutter by the first quarter 2011. Meanwhile, following deep job cuts in 2008, investment banks started to hire again in 2009. But now with markets ice cold—and predicted to stay that way at least until 2011—firms might be significantly cutting back again. Bank of America, for one, is in the midst of 1a large job cut, reportedly sacking 5 percent of its capital markets staff, and some analysts believe that other banks, afraid of the cooling markets, if not a double dip, might not be too far behind.
6. The legal sector
In the legal sector, 2009 saw a dramatic drop in hiring—a trend that has continued into 2010, with entry-level hiring not likely to return to pre-recession levels any time soon. Law firms have adopted a variety of solutions to maintain a smaller, more efficient workforce. Many of these solutions will likely survive beyond the recession, and affect law firm infrastructure, professional development, compensation and recruitment.
In addition to cost-cutting moves like the consolidation and relocation of back-office functions, other measures include a shift from traditional lock-step salary structures toward performance-based compensation systems. Many firms now offer alternative, non-partnership career tracks or have established apprenticeships for new lawyers. On the recruiting side, behavioral interviewing techniques are gaining popularity as a means of identifying candidates who will, in the words of one law firm hiring partner, “be able to deliver client service on day one.”
7. More short term jobs
The recession might be over, but unemployment figures have remained the same. This has forced Americans to look at jobs differently, with many accepting temporary and part-time positions rather than holding out for full-time permanent work. That’s helped the underemployment rate to remain sky-high—it’s currently over 18 percent—and there are no signs of it changing anytime soon: retailers are expected to hire up to 650,000 temporary workers this holiday season.
Toys R Us is an example of a company that is going even further: it plans to open 350 temporary “Holiday Express” stores by early October, creating 1,000 temporary retail positions. Other temporary positions are expected to become available during the holiday season. But when those temporary positions end, the unemployment rate will go right back to where it was before they were created.
8. The IT consolidation trend
The initials “IT” and “M&A” already go together like cereal and milk. And with spending on hardware, software and IT services expected to hit $3.5 trillion next year, the major players in the field have lots of incentives to keep adding to their range of offerings. One way they’re doing that is by snapping up smaller firms. Recent examples include HP’s acquisition of 3Par, Intel’s purchase of McAfee and IBM’s takeover of Netezza. But while the rapid pace of consolidation might be a good thing for consumers, waves of tech professionals will likely be squeezed out of Silicon Valley just as quickly.
9. The importance of internships
Because of the shortage of jobs, landing an internship is going to be more important than ever. Despite increased competition, if you’re a college student or looking to break into a new field, they’re an integral part of your next career move.
Starting in high school, students need to cultivate paid or unpaid work experiences that build skills, character, work ethic and resume. Employers use internships to prescreen and hire talent. Your career currency comes down to the following equation: internship experience + skills. Even if only on a volunteer basis for a few hours per week—this is how you get your foot in the door and demonstrate your passion for your field of interest.
10. Negotiate a package, not a salary
While the recession has affected the number of jobs and the kind of compensation on offer, it hasn’t changed how you should approach salary negotiations. However, what you negotiate for might change. While salary increases, stock options and signing bonuses might be in shorter supply, there might be opportunities to for other types of compensation such as at-risk pay based on milestones achieved, paid time-off and a flexible work schedule.
You should value the entire package and quantify everything. How you do that is up to you. Your compensation number should factor in what is essential to you and what is non-essential. You could even give weights to the essential and the non-essential in determining the value of your offer. As an example signing bonus, relocation, 401k match, day care and base salary could get an 80 percent weight while the other 20 percent would fall under extra vacation, nicer title etc. At the end of the day, each person will be different on what they value and what they consider essential.
— The Staff of Vault.com
Let’s start with the big one. The piece of data that would sway the electorate one way or the other in the upcoming elections, determining once and for all which party knows best when it comes to job creation. That’s right: we’re talking the final monthly jobs report prior to the mid-terms. In political punditry, it doesn’t get much more fevered than that—especially when the best you’ve got to on otherwise is speculation over whether one of the candidates happens to be a witch.
As with most regular events that get a fevered build-up (New Year’s, anyone?), the announcement just had to fail to live up to expectations—and it surely did, with the economy leaking just enough jobs to ensure that the overall number came in at an unchanged 9.6 percent. Politically, that’s the worst outcome either party could have hoped for: the failure to get the expected rise to 9.7 percent leaves Republicans without an easy case to make when it comes to accusing Democrats of job-killing policies, while the fact that things haven’t improved means the Democrats can’t claim to have figured out anything approaching a solution either.
(Incidentally, a recent Vault poll found that the public is more or less aware of that: when asked which party was most likely to make a difference to the unemployment crisis, the number of respondents who plumped for one side or the other came to less than 50 percent combined. That compares to 38 percent who stated that the two parties need to work together, with the remainder suggesting that government should get out of the way altogether and just let business get on with it.)
By far the most interesting employment-related number of the week came from the Pew Economic Policy Group, which found that a record 30 percent of unemployed Americans had been out of work for at least in August. And it gets worse: the technical definition of “long-term unemployed” is someone who’s been out of work for over 6 months. In August, 71 percent of the “long-term unemployed” had been out of work for at least a year—dating their layoffs back to some of the darkest days of the recession. The risk, of course, is that the longer someone is out of work, the harder it is for them to find a new position—especially if the type of job that person did isn’t likely to return. That scenario gave rise to perhaps the most depressing sentence of the week, courtesy of USA Today (emphasis added): ” Many of the long-term unemployed will struggle to find work even after the job market picks up, and some will never work again.”
Things don’t look much rosier when considering the major hiring announcements from the past week, either; notwithstanding the announcement that Kohl’s is hiring 40,000 seasonal workers, any other significant announcements of new opportunities tended to be in overseas markets.
It’s unlikely that we’ll see much improvement in the job market before the elections take place at the end of the month, but at least there’s one thing to be thankful for: the attempted politicization of the unemployment number should die down, at least for the foreseeable future.
Is there any point in even mentioning the biggest job/economy-related story of the week? We all know by now that the recession ended in 2009, right? Officially, at any rate, if not by Warren Buffett’s more common-sensical standards. And we’re all equally aware that, whether we’re technically in a recession or not, things are still pretty bleak and likely to remain so for some time? Good. So let’s move on to the good stuff.
Frankly, economic distractions aside, it hasn’t been the best week if you’re looking for positive employment news. Sure, we found out that retailers are anticipating a slightly better festive season than last year, prompting a prediction of up to 650,000 temporary jobs during the period this year. And, sure, Macy’s alone is creating as many as 65,000 temporary positions. All of that is decent news, but temporary hiring is, well, temporary—and the example of the Census earlier this year suggests that, in this economy, once temporary jobs have gone, the unemployment rate is likely to go straight back up to where it was prior to the positions.
There was some positive news for the tech sector, where it emerged that spending is estimated to top $3.5 trillion in 2011—and all of that spending does tend to suggest that hiring will follow. But that was tempered by news of cuts in other sectors, as noted on Vault’s Employment Tracker. While the news that Abbott Laboratories is laying off 3,000 workers was the worst cut of the week in terms of pure numbers, it wasn’t the worst signal out there. That honor went to the news that Bank of America is cutting 400 jobs in its global banking and markets division. The reason for that—a slowdown in revenue from trading and advising clients—may well have industry-wide reverberations. And as we’ve learned to our cost over the last couple of years, when the financial industry isn’t making money, the rest of us may well have good reason to be nervous.
A rocky job market affects more than just the unemployed and recent graduates—even those still employed are feeling the sting. With little certainty of finding placement elsewhere, labor statistics show that few professionals are willing to leave their jobs, despite a rise in reported employee dissatisfaction and especially dispiriting working conditions recently seen in the news. To gauge this sense of career confinement, in a recent poll Vault asked its readers “What would be the last straw to make you quit your job?”
One workplace issue which held the collective attention this past summer was the threat of bedbug infestations in New York City—and it would be hard to blame anyone who runs screaming from an office crawling with them. However, just 2 percent of Vault readers said these vermin would prompt them to resign. But quitting may not be necessary: Bedbug infestations have thus far resulted in complete shutdowns of a Victoria’s Secret, Manhattan offices for Google and Cadwalader, and most recently the flagship Niketown store. And you can’t quit if there’s no job to go to.
Fewer still indicated that they would pack it in for an impending company merger. Yet, if we’ve learned anything from the year’s rash of buyouts, industry consolidation doesn’t leave much room for staff: The merger of Pfizer and Wyeth, for instance, resulted in thousands losing their jobs and facilities shutting down around the globe. Now, with the completion of United and Continental Airlines’ amalgamation, another drastic round of layoffs won’t be far off.
The prospect of benefit reductions also failed to influence resignation decisions, with just 5 percent stating that would be their breaking point. Sadly, this has been reflected in practice: One of last year’s more shocking developments was the news that insurance company WellPoint reduced its own employee health benefits, even while encouraging staff to protest health care reform. In spite of that, there was no surge of people lining up to leave Wellpoint in response.
The point at which respondents begin to rankle, it seems, is the prospect of outright mistreatment. While toxic offices have inspired some of our favorite films, from Office Space to The Devil Wears Prada, they remain a professional hazard. Abuse can take different forms at different levels: Some superiors will demoralize staff to the extremes seen in the tragic suicides at Foxconn, while sexual harassment may (allegedly) come from such diverse figures as the New York Jets or the CEO of Hewlett-Packard. That kind of treatment would apparently cause 31 percent of respondents to move on.
And then there’s the suffering endured at the hands of customers and clients. By now we’re all familiar with one such incident, when an allegedly unruly passenger prompted the abrupt resignation and emergency chute escape of JetBlue flight attendant Steven Slater. And he’s likely not alone in his frustration: some 9 percent of respondents to the poll said they’d have likely done the same.
Ultimately, however, stability rules the day: Nearly half of our respondents confirmed the notion that the only way they’d quit is with a new job waiting for them. But even if that seems the safe bet, it’s not always the wisest—by continuing at a job that doesn’t meet your standards, not only do you risk stagnating but your industry does as well. As posited by author AnnaLee Saxenian in a Wired article, “Job-hopping, rather than climbing the career ladder within a corporation, facilitates flows of information and know-how between individuals, firms, and industries.” When the workforce is able to distribute its talents effectively to where they are required, that’s when growth becomes possible.
While one hopes that a healthy dose of self-esteem should sufficiently compel disenchanted employees to say enough is enough, the viral popularity of “folk heroes” like Steven Slater and TheChive.com’s fictional “Jenny” still indicates a sense of powerlessness in the workforce. Their exploits, real or not, reflect what many wish they could do themselves—throw caution to the wind, and “deploy the slide” as a defiant act of personal satisfaction. But without dramatic improvements in the rate of job creation, most will remain in a holding pattern.
— Alex Tuttle, Vault.com