Layoffs—The Employee’s Nightmare
“It hit me like a ton of bricks. I was in a state of shock.”—Communications manager, age 44.
“It’s a terrible blow to your self-confidence. You feel worthless.”—Chief financial officer, age 38.
“What kind of economy have we created that sacrifices people in their prime?”—Clothing executive, age 47.
WHAT experience did these individuals share? Each went through the traumatic experience of being laid off from work.
Look again at the ages of those workers. They were not novices, so they likely felt that they had a measure of job security. And they were at what many would consider their peak earning years. But the end of their employment was quick and unexpected. “They told me to clear my desk and pack my things,” said the communications manager mentioned above. “I was gone, just like that. Poof.”
What Happened?
Economic uncertainty is nothing new. In many countries, there have always been periods of relative prosperity followed by recessions or depressions. And the recent economic downturns experienced throughout the world, even before the war in the Persian Gulf, showed how fragile economies could be even after years of relative prosperity. Many people, some for the first time, realized that they could not take their jobs and incomes for granted.
The effect of the economic slowdowns on the work force was staggering. Companies were compelled to cut costs to the bone, often resulting in sweeping layoffs. In the wealthier, industrialized member states of the Organization for Economic Cooperation and Development, a total of some 25 million people were unemployed at one time.
“Almost every day I get calls from friends in large companies who have been let go,” said a home-interior designer. “A lot of the companies I work with are down to half the business they had a year ago.”
Layoffs have always been part of blue-collar life. In the recent downturn, an increasing number of white-collar workers also lost their jobs. “These are the economic icon jobs,” said Dan Lacey, editor of the newsletter Workplace Trends, “the jobs that gave us the ability to buy a house in a nice neighborhood and drive two cars.”
Many of those jobs were lost in the last few years. And the workers who were laid off found themselves, as Newsweek put it, “weighted down by mortgages, young families, big bills and an increasingly uncertain future.”
What Are the Effects?
There is a twofold impact to all of this: Laid-off workers are hit both financially and emotionally. The financial strain is obvious. With less income, one’s standard of living must be adjusted. And unemployment has an emotional effect as well.
For example, the outlook of young people toward job security changes. Sporadic employment becomes a normal, accepted way of life. The Wall Street Journal noted that off-and-on unemployment has turned many of Britain’s youths into “permanent adolescents.”
There are more deep-seated emotional implications for those who are laid off after years of steady employment. “When there’s a layoff,” said management psychologist Neil P. Lewis, “it’s not just losing a paycheck, but losing a bit of your self-concept.”
In fact, psychologists have noted that the trauma of being laid off is similar to the trauma associated with the death of a loved one and with divorce. Initial shock gives way to anger, which in turn leads to grief and then acceptance. “Some people go through it all in two days,” says Lewis. “Others take weeks and months.”
The emotional toll is also seen in that those laid off become more susceptible to alcohol and drug abuse. Despair can even lead to family violence or breakup. “Those feelings have to go somewhere,” stated Stephen Pilster-Pearson, director of employee assistance at the University of Wisconsin, U.S.A., “and one of those places, of course, is home.”
In an even more tragic reaction, a university graduate in Hong Kong chose to end his life after five years of unemployment. He stepped into the path of an oncoming train.
So when jobs are lost, more than the wallet is affected. Thus, it is imperative to see beyond the financial aspect of the problem. Highly charged emotions are involved, and families must pull together and unitedly work at solutions.
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The End of Economic Expansion?
In the past year, fear of turbulent waters in the sea of finance has been reported worldwide. Consider several examples:
France: “The world is reaching the end of the longest period of economic expansion that it has ever known. . . . If European countries do not have much to fear in the short term, thanks to the boost provided by German reunification, they cannot expect to escape completely. . . . The markets have seen the danger coming.”—Le Monde, Paris.
Brazil: A recession in the United States would “inevitably be transmitted and felt in the other industrialized countries and, as a result, would create greater restrictions for the growth of exports from the less-developed nations.”—Fôlha de S. Paulo, São Paulo.
Britain: “The British economy, with its deeply rooted inflation, high interest rates, and slow growth, also appears uninviting.”—Financial Times, London.
Canada: “A lot fewer employers are looking for a lot fewer workers.”—The Toronto Star.
Germany: “Parallels to the 1973 oil-price shock are already visible . . . as [are] signals of recession.”—Neues Deutschland, Berlin.
Japan: “Land values are now like a hair-trigger bomb sitting at the heart of the world economy. If the bomb were allowed to go off and land prices fell, Japanese banks would implode as [loans] secured on Japanese land became next to worthless. This, in turn, would trigger a worldwide recession.”—Australian Financial Review, Sydney.
However, the end of the Gulf War early in 1991 brought renewed hopes of an upturn in economic activity throughout the world. Still, it is evident that national economies are indeed fragile things, especially considering the enormous debt load that already burdens many countries.