The employee layoffs that are starting to pile up around Corporate America may be only the latest evidence of a disturbing syndrome — namely, that most companies are so adamant about securing today's bottom line, they blithely cover their heads in sand with regard to tomorrow's.
The high-profile cuts on Wall Street are but a smallish fraction of the overall job carnage, with the unemployment rate surging in recent months and reaching 6.1 percent in August. And according to observers of the employment market, the retrenchment is happening at all levels, up to and including senior executives. Here's a question: Won't companies need some of those folks when the economy starts humming again, as it surely will?
For the next several years, talent is going to be in increasingly short supply as the exodus of Baby Boomers from the work force, and the supply of younger talent to replace them, head toward a deep, dark nadir in 2012. Laying off people now will only exacerbate what almost everyone agrees is shaping up as a huge problem. While companies have always had the mindset that it's easy to staff up as demands dictate, that probably won't be the case in the early years of the forthcoming decade.
Couldn't they simply hire back the people they laid off? Only theoretically. Because laid-off boomers will have a difficult time finding work in a shrinking job market, many are likely to employ themselves or switch careers; by the time their former industries want them, they'll have moved on.
If they're wanted at all, that is. Dale Winston, CEO of recruiting firm Battalia Winston, opines, "Sixty-year-old Boomers who get knocked out right now are not going to find a home, and in five years nobody's going to want them because they will have lost the continuity of their experience." She adds, "The consequences of today's job cuts are far greater than they've ever been because of the demographic issues companies will be facing over the next five years."
Eventually, the Millennials, 75 million strong, will ride to the rescue. Battalia Winston estimates that the talent gap will be closed by about 2019, when the youngest of that generation starts entering the work force. Until then, those charged with deciding on and executing layoffs — and surely some CFOs are among them — might be better off in the long run by standing pat.
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