We have a veritable series going on about what in the past we have called "How NOT To Fire People". The idea being that, yes, you need to slash costs; and, yes, payroll takes up most of your costs; and, yes, it's best not to cut back on marketing during a recession; but, no, you really don't want to lay off any of your employees, because it will hurt the morale of your remaining employees and will leave you in a bad position when the economy finally does start moving again, and also because, frankly, you got into running your own business not just for reasons of cold, hard business sense (not that there's anything wrong with that) but also so that you could be a conscientious, benevolent manager, and you just don't want to fire anyone, and that's that.
The New York Times has the goods. It cites one employer that has been faced with revenue problems--as it happens, it's a nonprofit that used to rely in part on the generosity of one Bernard Madoff--which has responded by cutting several employees' workweeks to 24 hours (e.g., three days), while cutting pay a corresponding 40%. A nice side point to this is that the employees have been able to make some of that up in state unemployment benefits that are specifically designed for when workers reduce your hours due to economic circumstances (as opposed to personal performance--Jerry Kalish blogged a bit about these sorts of benefits last week).
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