Thursday, July 16, 2015

More Where They Came From

So I was talking with a co-worker about how businesses behave when they lay people off (generally speaking) and we came to the conclusion that a) as far as most businesses are concerned, they will never be in a position where their past behavior makes future recruitment more difficult and b) they are likely correct in this assessment.

Which creates a problem for the workforce, as if businesses have no incentive to treat people well, they can shift many of the risks of doing business onto those people - which my observations have borne out, mainly when it comes to the secrecy that many businesses engage in when they let people go. And many people know this. And so I wonder what effect this has on public confidence. Granted, the Consumer Confidence Index has been rising; on June 30th, the Conference Board noted that: "Overall, consumers are in considerably better spirits and their renewed optimism could lead to a greater willingness to spend in the near-term." But if you understand that you suddenly may not have a job if the prospects for your company dim, you may decide that it's wiser to convert disposable income into savings, rather than goods and services.

And so I wonder to what degree business confidence that they'll always be able to find the workers they need acts as a drag on the overall economic picture. It is an interesting thing to study, and since I'm going to have some free time this summer (although not due to being laid off), I may take some time to look deeper into it.

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