• Skip to main content
  • Skip to primary sidebar
  • Skip to footer

Andrew Jensen

  • Home
  • About
  • Services
    • Efficiency Consulting
      • Business Efficiency
      • Efficiency Coaching
      • Time Management
    • Business Coaching
    • Customer Service
    • Sales & Marketing
      • Marketing Consulting
      • Internet Strategies
  • FAQs
  • Why Andrew?
  • Partners
  • Articles
    • Management
    • Employees
    • Customer Service
    • Communication
    • Entrepreneurship
    • Cutting Costs
    • Organization
    • Personal Efficiency
  • Contact
    • Contact Andrew
    • Media Inquiries
    • Public Speaking
You are here: Home / Cutting Costs / Cutting Costs Without Cutting Jobs

Updated on September 29, 2010 by Andrew Jensen Leave a Comment

Cutting Costs Without Cutting Jobs

During times of economic uncertainty and hardship, companies often reflexively resort to layoffs and downsizing to quickly cut costs and stay afloat, usually without realizing the very real and potentially high costs of reducing their workforce. Layoffs are useful in some circumstances and a natural part of the business cycle, but they bring their own risks and pitfalls which may not be evident during a downturn.

Laying off employees is a short term fix with long term implications. While downsizing may seem like the quickest and easiest way to save money now, there are many ways a botched layoff process can end up costing the company much more than was saved over time. Cutting staff should be a last resort after a company has exhausted all other opportunities to cut costs.

So, why should layoffs be avoided in the first place?

Laying off large numbers of employees can backfire on a company in a number of ways. The morale of the remaining employees takes a severe hit and their productivity suffers. If they’ll just be laid off in the next round of cuts, what incentive is there to perform well? Some may be motivated to work harder with the hope of saving their job, but the uncertainty that comes with layoffs can be crippling to the workplace environment.

There are also immediate costs associated with layoffs, such as severance pay, potential legal fees, and the departure of employees who don’t want to be stuck on a sinking ship. Companies often lose valuable employees in the wake of mass layoffs; these workers are often highly skilled and difficult and expensive to replace. Once business picks back up (which it inevitably will), companies find themselves at a loss for the specialized employees lost due to layoffs or who left voluntarily, which can seriously hamper competitiveness in the future.

layoffs aren't always the most efficient way to cut costsWith this in mind, what are some tips for businesses intent on avoiding layoffs?

First and foremost, the management, executives, and owners of the business must be willing to share in the sacrifice they are asking of their employees. Many companies, particularly small businesses, are proud of never having laid off an employee and use this record to attract employees and new hires. In order to maintain this streak, many owners are cutting back on their own salaries and benefits in a measure of solidarity with workers. Employees are much more accepting of cuts to their hours or wages when their superiors are also making concessions.

Reducing the number of hours existing employees work is a step implemented by many companies looking to cut costs while retaining employees. There are a few ways this can be done, each of which should be carefully considered and openly discussed with the employee in question. He or she will, in nine out of ten cases, accept a decrease in hours if the alternative is being laid off. Transparency is key here – as mentioned, uncertainty in the workplace seriously damages morale and productivity.

Laying off a large number of employees may seem like an easy way to reduce costs for a struggling company, but in many ways it will hurt the business in the future.

Filed Under: Cutting Costs

About Andrew Jensen

Andrew Jensen, a business growth, efficiency & marketing consultant, provides business advisory services for clients in the Baltimore; Washington, D.C.; York, Hanover, Lancaster & Harrisburg, PA regions. Andrew advises regarding business growth, productivity, efficiency, business startups, customer service, and online/offline marketing.

Reader Interactions

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

Primary Sidebar

Optimization Strategies for Success™

Contact Andrew Jensen, a business growth, efficiency & marketing consultant, to learn how he can help strengthen your business or nonprofit organization.

Andrew provides business consulting services on-site, by phone & by email for companies nationwide.

Andrew advises regarding business growth, productivity, efficiency, business startups, customer service, and marketing (both offline & online).

Areas Served

Andrew places an emphasis on personal, onsite consulting with clients. He primarily serves clients throughout the United States. International clients are considered on a case-by-case basis.

Andrew is conveniently located within a short drive of Baltimore, Hunt Valley, Bel Air, MD; Washington, D.C.; Wilmington, DE; and Harrisburg, York, Hanover & Lancaster, PA.

Popular Articles

  • Why Is College So Expensive?
  • 5 Ways to Properly Greet a Customer
  • How Office Lighting Affects Productivity
  • When Is the Best Time to Conduct Meetings and Important Business?
  • How Does Workplace Attire Affect Productivity?
  • How to Handle Employee Insubordination
  • How to Become an Efficiency Expert
  • Should You Work More Than 40 Hours a Week?
  • Holding Employees Accountable for Performance
  • 5 Ways to Create a Motivating Work Environment

Recent Comments

  • Carla M. on When Is the Best Time to Conduct Meetings and Important Business?
  • Eli Richardson on Combating the Mid Afternoon Productivity Lull in the Office
  • Tom Melhuish on How Office Lighting Affects Productivity
  • PIUS BYEGARAZO on How to Handle Employee Insubordination
  • Brooke on How to Become More Productive at Work

Footer

Areas Served

Andrew places an emphasis on personal, onsite consulting with clients. He primarily serves clients throughout the United States. International clients are considered on a case-by-case basis.

Andrew is conveniently located within a short drive of the following cities: Baltimore, Hunt Valley, & Bel Air, MD; Washington, DC; Wilmington, DE; Harrisburg, York, Hanover & Lancaster, PA.

Contact Andrew

Andrew Jensen
Sozo Firm Inc
New Freedom, PA

Note: Due to high demand, Andrew currently has a wait list for new projects.

Email Andrew
Toll Free: 800.460.SOZO
Office: 717.885.2312

Services Offered

Business Consulting
• Efficiency Consulting
• Customer Service Consulting
• Sales & Marketing Consulting
• Startup Consulting

Audits
• Business Efficiency Audit
• Customer Service Audit
• Advertising & Marketing Audit
• Website Usability Audit

  • Management
  • Employees
  • Customer Service
  • Communication
  • Entrepreneurship
  • Cut Costs
  • Personal Efficiency
  • Be Organized

Andrew Jensen - Efficiency, Growth & Marketing

Sitemap · Privacy Policy · Copyright © 2023 Sozo Firm Inc · All Rights Reserved · 800-460-7696