Layoffs Not Employers' Only Option in Tough Economy

Every time we turn around, there's another sign that the economy is hurting. On Monday, The Conference Board released its Employment Trends Index (ETI). The October index of 105.3 was down 1.8% from September and 12% from a year ago. The ETI has been declining for the past 15 months.
 
And Gad Levanon, senior economist with The Conference Board, isn't optimistic about the near future. The sharp decline in the ETI in recent months suggests we will experience even greater deterioration in the labor market in the months ahead."Demand for goods and services are down, and companies are responding by slashing their workforces, Levanon says. The reductions likely will continue for several quarters until the economy starts to see recovery.
 
But layoffs don't have to be the only option in this tough economy. Employees will be expecting smaller increases in pay and in benefits, says Nancye Combs, a human resources consultant. They understand that the current problems are everyone's problems.
 
You still need to reward high achievers, though it doesn't have to be with large bonuses. Supplement pay with recognition programs, which are generally inexpensive but help workers feel appreciated for what they do. "Attaboys and attagirls will pay huge dividends in motivating employees who need to feel appreciated for a job well done,"Combs says.
 
Hear more from Combs and other distribution industry experts on what distributors can expect from the next year and how to prepare for 2009 in the Nov. 25 issue of MDM.