The Hidden Impact of The Recession

The current buzz is that the recession is over or at least, ending.  Businesses are cautiously optimistic about the future, consumers are thinking about opening their wallets and the media believes that things are improving.  But what has the downturn done to the world beyond the money issues?

Previous research has shown that one of the major causes of relationship breakups is financial stress.  When money is tight, couples start to argue and before long, the smallest of issues is enough to set off arguments.  For many people, job losses have hit them for the first time in their lives.  Going from a full-time job to living on welfare can mean the loss of almost everything and starting again is tough even when you’re young.  This kind of stress is fracturing relationships and families.

For those workers lucky enough to find another job, they are now faced with the employer having the upper hand when it comes to negotiation.  Many jobs can attract hundreds of applicants, giving the company a huge range of choices.  This inevitably leads to lower salaries.  Existing employees are told that they are lucky to have a job at all when they ask for a salary increase.  Major companies such as Hewlett Packard have asked their employees globally to take pay-cuts and in some cases where labour laws have allowed even forced them.  The argument is that the company needs to maintain profit.  The reality is often that CEOs are paid incentives associated with keeping that profit high and are looking out for number one.

Is this changing the dynamic of the employer employee relationship?  Have staff become numbers and cost centres rather than the driving force behind the success of the business?  The number one reason for people leaving their jobs is lack of recognition, not money as many people assume.  Staff want to know they are doing a good job first and foremost.  Yes, they want to be looked after financially but they are not stupid, they see the effects of the recession and understand that money is tight for many employers. 

I was recently in a role where I had to make people redundant.  Not because there wasn’t enough work in my area, but because I was given an arbitrary number of people to get rid of.  For the first time in my working life I was faced with a decision I felt I couldn’t support.  Don’t get me wrong, I had made people redundant in the past when there simply wasn’t enough work but this was different.  I argued hard against it but the reality of the situation is that if I wasn’t prepared to do it, I would be replaced with someone who was.  I did it exactly the way I was supposed to and ranked the people on their abilities and cut those who were performing the least amount of work.