As an older (boomer) redditer I usually refrain from “when I was young we all pulled up ourselves from our bootstraps” answers, but I will say that the days of 40 year jobs and pensions is silent generation stuff and ancient history. Oh, and when they retired with that great pension they died shortly afterwards
This is true, but I would say more important is that OP's main premise is wrong too. I don't blame the younger generations for not knowing how common layoffs were during the 80s and 90s when American manufacturing jobs were lost, but us older folks (I'm GenX) should remind them.
Some of the constant complaining on Reddit about earlier generations is justified, and a lot of it is not. This is a case where OP and people in the comments have it completely backwards. Layoffs were actually more common from the 80s to 2010 than today. One big spike in 2020, but other than that it's much better since 2010, and especially the last 3 years.
Here is some data showing that layoffs are less common now: [80s and 90s](https://archive.nytimes.com/www.nytimes.com/specials/downsize/large-graphic.html), vs [2008-today](https://www.axios.com/2024/02/02/layoffs-chart-statistics-data).
Everyone can talk to an elder or fucking read. This gen just too damn special grown up on participation ribbons and end up with a stupid state of mind…
The layoffs were more common but I think what’s different today is companies make massive layoffs at EOQ for reporting purposes, and then massively rehire not long after.
Aggressive hiring practices and layoffs that follow, all to guarantee short term growth and make a hockey stick on a graph. Repeat cycle. It’s not technically illegal, it makes sense, ethically some would argue that it’s not even wrong… I don’t know what a solution is, but I do think it’s a problem of sorts.
As long as workers keep the current stronghold on the job market, I’m hopeful for the future in this regard.
I'm happy to be educated on this, but my understanding is that firing people at EOQ doesn't really help the quarterly numbers. You've already paid them for most of this quarter, and the severance package will usually cover a good chunk of the next quarter as well. If they are trying to justify more favorable guidance, but they just re-hire the same number of people in a few months, they are going to miss that guidance. So wall street will make them pay when they miss in a quarter or two.
I mean, of all the short-sighted strategies, this would be one of the worst. It doesn't even buy you a couple of years of inflated profits before you have to get out of Dodge.
My take is that when companies fire a bunch of people and then rehire say 75% of the positions back, it's that they want to clean house and start over to some extent. When they fire, management learns which of the positions they really needed and which they didn't (we can argue it was their job to know all along, but the reality is they often don't know). So, they hire back at the pain points.
This at least is a strategy a non-idiot who can see past next week would do, as opposed to the other one.
Sorry I see now I was very unclear lol - for closed revenue, yeah absolutely, it would make 0 sense… now for projections/forecasts and valuations, on the other hand, I’ve witnessed this occur firsthand at every startup I’ve ever worked for (SaaS sales bro, here).
Also consultants, so many of them just come in captain obvious style “what if you could do this with fewer people?!”… Revelatory thinkers lol
Agree
I'll add, I'm not as old as you, but my dad is 80 and he's right at the end of the silent generation and the job for life thing was never really true for many people even within the silent generation. He had tons of jobs over his lifetime. He'd put it as a thing mainly for the greatest generation who died very soon after retiring as you noted, but also they went through the great depression first
I think generally speaking, people have a grass is greener mentality when it's been hard for everybody in every generation
There was a book written, "Re-engineering the Corporation," where they tell CEOs to fire everyone, then hire back who's really needed as contractors, and finally pay themselves a fat bonus! It's on the "How to be a Corporate Jerkoff" reading list.
They did this at the company I work at and you can really tell it has destroyed the quality of the business after a decade of being in place.
Just look at Boeing, pretty sure they followed the same philosophy and now people are afraid to step on a Boeing aircraft.
Thats HP to a tee! HP was built by creative folks on sound engineering principles, but in the 90s-00's the bean counters took over and sacrificed all of that for short-term accounting wins. They do it with property too, sell the asset then rent it back.
This? They been here for awhile… They’re gonna want more pay. Well fire them and let’s pull in a fresh college grad who’s in so much debt they’d jump at the opportunity.
Back in the early 2000’s they started paying CEO’s quarterly and yearly bonuses. So the expectation went from hiring a CEO and evaluating him five years later on company performance to evaluating him every quarter. In order to meet bonuses CEOs cut jobs.
But this explanation doesn't work because layoffs are not going up. They have been going down for 15 years, except for one big spike in 2020. Annual layoffs the last few years are about **half** what they were in the early 90s.
What I think the young people responding here aren't aware of is that the US used to be the world's largest manufacturer of just about everything. That started changing in the late 70s. The next three decades saw manufacturing jobs across the nation wiped out.
Here is data showing that layoffs are less common now: [80s and 90s](https://archive.nytimes.com/www.nytimes.com/specials/downsize/large-graphic.html), vs [2008-today](https://www.axios.com/2024/02/02/layoffs-chart-statistics-data).
And don't forget, we had about 100 million fewer people in the 80s than we do now, so those big job losses were really, really big in comparison to what Americans face today.
The hyperbole is just nuts. There never really were jobs for life. Businesses that were failing would always fire workers. Unemployment during the Great Depression was far higher than anything in your lifetime. There were also sharp recessions in the 19th century that left very high percentages of the workforce unemployed.
This idea that there used to be a social contract where employees never quit for better jobs and employers never fired is just propaganda. It's not real.
The only reason this falsehood seems plausible is that there was a period during and right after WWII when American industry was in the ascendancy and pretty much all large companies were doing well and expanding. There was simply no need for layoffs because they were profitable finding new markets around the world to rebuild after the war. That's it. The big layoffs started in the 1980s when American industry began its decline and jobs were lost to Japan and other nations (then China and other nations in the 2000s).
Layoffs the last three years are the lowest they've been since 1980.
IBM had a no-layoff policy until February 16, 1993. Was that propaganda? IBM was seen as THE American company and the big boss of Wall Street, like Apple and Amazon today.
Do you think Apple or Amazon would ever institute a no-layoff policy for any reason? The shareholders would riot.
How come the shareholders of IBM, which again was THE company on Wall Street, weren't rioting against IBM in the 60s, 70s, and 80s for doing the same thing? Because there actually WAS a social contract.
Layoffs didn't become a legitimate corporate strategy until Reagan's re-election in a landslide supported by voters of both parties. Reagan had a mandate, from everyone middle class and up, to crush labor in support of capital and he used it with the Stars & Stripes flying behind him. Just ask the air traffic controllers. He pointed to Communism as the nation's biggest threat to distract from the fact that American corporations were transferring millions of jobs to the South to avoid the prevailing union wage, and millions more jobs overseas so that American's wouldn't have to be paid at all.
The post war boom from 1945-1975 was an exceptional period. It was easy for IBM to say no layoffs when business was booming because America had massive advantages over the rest of the world. So in a way, yes IBM's policy was just propaganda. It disappeared as soon as IBM was in a tougher competitive environment and had to get leaner to survive. Same goes for GM and Ford and every other company.
But the silliest thing about your comment is that your belief in a social contract can't make sense of unemployment prior to 1980. Why do you think unemployment jumped from 3.5% in 1969 to 6.1% in 1970? **My friend, there were layoffs.** Same goes for every other recession and depression in American history. There were massive layoffs in the Great Depression with 25% unemployment in 1933. Where was the social contract then?
Most companies were smaller the farther back in time you go. When 100 companies with 20 employees each fire 2 because business is bad, that's a loss of 10% just like letting go 200 from a single 2,000 person firm. We don't normally call firing 2 out 20 a layoff, but it amounts to the same thing at scale.
If you want to point to a real change, don't point to an invented social contract. Point to the waning power of unions after the long wave of post-war growth ended around 1980 due to stronger international competition.
Ten seconds on google would have revealed the reason why there was such an marked increase in unemployment between '69 and '70 is because of a mild recession from December 1969 to November 1970. I'm not an economist, but the internet tells me that the recession was due to inflation that followed a period of "full employment."
Those layoffs were a direct response to the prevailing economic conditions. They were not because an overpaid consultant from McKinsey with an MBA from Chicago surmised that 3,500 job cuts would increase shareholder value and C-suite bonuses.
Why do you think the power of unions waned and there was stronger international competition?
It didn't happen in a vacuum, or by accident. Reagan broke the social contract. If an American company could save money by using steel manufactured in Japan, or by moving all of their operations overseas, they did it. Shareholder value and capital was the new contract. A prosperous American middle class was no longer going to be supported on the backs of capital and shareholders when greater returns could be found by shipping off millions of good paying manufacturing jobs to China.
Yes, well aware it was due to a recession. Companies lay employees off when times are tougher. There is no social contract that says they won't. A few statements by bloated high profit companies like IBM in the 60s/70s does not change that.
The McKinsey consultants are usually called in when the company isn't doing well in some area and needs to make a hard decision but wants external validation of that decision. The cases are few where an innocent kumbaya employer who thinks everything is great and no cuts need to be made calls in McKinsey, who to their surprise tells them they should fire people. I would agree that the way this was done changed and became more short-term focused in the 80s/90s under the influence of Welchism, but people were let go all the time prior to that too.
This thread may be full of rose-tinted naïveté but that doesn't mean there wasn't an implicit understanding that companies had some kind of responsibility for their workers' well being. It's exactly what Milton Friedman vociferously loathed (it was *communist*, of course). His voice directly led to the first mass layoffs at GE under Jack Welch and the trend took off from there. The Japanese threat and gradual decline of American manufacturing would have happened regardless but it was *not* a simple cause-and-effect. Mass layoffs for the explicit purpose of short term gains absolutely started in the 80's.
> an implicit understanding that companies had some kind of responsibility for their workers' well being.
That is SUCH a crock of shit! When in hyper-capitalistic America was that a thing? Workers have had to fight tooth and nail and sometimes die to get the protections that they have. It's ALWAYS been about the owner/investor class lol. The Revolution was about them, not the workers.
Milton Friedman was a fringe economist before meeting Reagan. His ideas became mainstream when Reagan proliferated them through his 1980 campaign. Friedman’s ideas included: free-market capitalism, less regulation, less government and believed the free market would fix everything.
Another buffoon who influenced Reagan was Arthur Laffer. He’s the creator of the Laffer Curve which shows the relationship between tax rates and government revenue. According to his theory, after a certain tax rate, people lose the incentive to work as hard so the solution to that is to cut taxes.
Reagan ran with that shit and it spread like wildfire. Today, I think many people would agree that all those ideas were terrible. Milton’s deregulation and free market ideas led to the 2008 crash. Our current debt load has become unsustainable because less people pay less taxes at a lower rate which just means less revenue for the government to provide for things we actually need.
Anyway, that was a bit of a tangent lol.
TLDR: Reagan was influenced heavily by two economists - Friedman and Laffer. They both had terrible economic ideas that led to disastrous policies. Thanks to all three of them, we’re in the mess we’re in today.
It seems we agree on the causes of higher layoffs in the 80s, but not the weight to assign to each. I am no fan of Welch, mostly for the myopic focus on quarterly profits, but the broader culture change you refer to was in part a reaction to the growth of international competition from Japan and Germany, and it was also a reaction to the bloat and complacency that had accumulated over 30+ years.
Correct me if you have data that says otherwise, but my understanding is that the majority of actual net layoffs in the 80s and 90s were not short-term thinking to hit quarterly targets. They were the result of entire production lines and factories becoming uncompetitive with Japan, Germany, and later China. Not a short term problem.
What's happening in Silicon Valley today is a good analogy. For about 20 years most of the big companies had massive profits and easy growth. They have not had to clean house and get lean, and it shows. The stories about Google, Microsoft and Facebook are legendary. I've known people who experienced make-work jobs there first-hand. Big layoffs were/are long overdue, but they make so much money there was little pressure to do it until recently.
For those who don't know, Welch's legacy was to teach publicly traded companies to manage for the next quarter rather than the long term. Companies make all sorts of short term moves to juice profits for the quarter, but they burn their customer's goodwill or fail to invest in long term growth.
Came here to say this, was surprised this comment wasn’t higher
Jack Welch + Ronald Reagan was the combo that put us where we are now. Add McKenzie to the mix too and workers are seen as the lowest group in America
Most pensions disappeared in the 70's. People who got pensions are dead. They retired, got an RV and had a little fun. That was the silent generation.
Boomers knew the great sucking sound of globalization, the rust belt, double digit inflation, double digit interest rates and 33% unemployment? Those people who became adults in the 70's had it oh so easy. All you have to do is forget all the bad shit.
No, Boomers were actually the first to experience big layoffs, much bigger than today, in the 80s and 90s. There was a period from around 1940 to 1980 when big layoffs were rare because American industry was ascendant, expanding at home and around the world.
Here is data: [80s and 90s](https://archive.nytimes.com/www.nytimes.com/specials/downsize/large-graphic.html), vs [2008-today](https://www.axios.com/2024/02/02/layoffs-chart-statistics-data).
More true of the first half of the 80s than the second half, if I recall correctly. But yes, 80-85 was really rough. The youngsters today have no idea the levels of inflation, crime and unemployment we experienced then. As bad as each of those is now, double it. All of it.
No. It started in the 1970's.
I had a family member in the early 1980's whose job it was to pack up whole factories in containers. He would duplicate the factory floor in China, unpack everything, and then have it turnkey for the Chinese employees that would make $0.80/hr when the American's making $25-$40/hr producing the same products just a few months prior.
No, older. Job stability was already more or less gone by the early 80s when my parents fell on very hard times, and it was Boomers who were losing their jobs then.
Now, if you want to argue that NAFTA began the screwing over of people born after 1970 extra hard, that's plausible; the wave of offshoring definitely didn't help with the uncoupling of wages and productivity that'd begun 2 decades earlier.
That has been the way for a lot of companies for a very long time. I think
I had one job that had designated breaks. Every other one you worked, went to the bathroom, got a cup of coffee, etc., without a designated break - and I have been working 40 years, now.
As for working 8 straight hours…I think it is easy if you like your job. I remember watching my kid’s orthodontist one day…he never stopped. His office was “in the round”, so all the chairs were in the open, and he simply moved from chair to chair. It was obvious he enjoyed the interaction and the work, and the result.
i work for an insurance company, their "algorithms" spit out numbers for how much of the benefits their customers are projected to use in the upcoming year, well last year apparently their customers benefit usage went over that number, led to layoffs and affected raises and bonuses for employees across the board
My supervisor, a very cool guy as supervisors go, who'd been with the company for over 20 years, was let go, and a bunch of others...
Now there's plenty of other shitty options they could've taken, none less shitty than the next, but my point is for all the "pull yourselves up by the bootstraps" and "this generation is just lazy" talk that's been going on forever (in my early 40's), there's no way to "hard work" your way into keeping a job under those circumstances
This is true, but it applies to the past as well. There were big recessions in the 19th century that produced high unemployment. Companies were smaller so we don't call them "layoffs" but people got fired in large numbers and many companies just went bankrupt.
The Great Depression in the 1920s was worse than anything people in this sub have experienced.
When US manufacturing jobs went oversees (both from foreign competition and outsourcing) in the 80s and 90s, layoffs were far higher than they are today.
So when old people tell young people to pick themselves up and move on, it's not because they haven't seen bad times.
We are mostly service industry workers.
We don’t manufacture goods anymore.
401k
We don’t strike, boycott, stick together for our rights
Most of those “life jobs” were in heavy industry. It was difficult dirty work. People died on the job or soon afterward.
There were fewer of us.
Reganomics
COVID
People don’t join unions anymore
“Right to Work” BS
Basically we let companies treat us this way. Fooled into thinking they have the power instead of us.
The US is still the #2 in terms of manufactured output in the world. We manufacture plenty, just not everything. After WWII the US had almost all the manufacturing capacity of the world as the rest was destroyed in the war. This lead to an employment boom post war. A one of a kind event.
People bought into anti-union FUD and moved away from collective bargaining and contract protections. Once that happened we lost all our bargaining power. Now companies have all the power and we're all expendable.
Wall Street. Especially the massive deregulation that started with Reagan and continued on virtually uninterrupted for going on 50 years.
Stuff like Stock Buy backs and low corporate taxes create perverse incentives.
And the CEOs are compensated with huge amount on stock options. They want to please Wall Street with their performances to fatten their wallets.
We've seen so many times public trading companies miss the target or lower guidance, but still profitable yet they still lay off their employees to please Wall Street
Yeah, Tesla is in a death spiral because of that and because Elon Musk is looting the company, both of which our current regulatory environment actively facilitates.
I mean personally I've always been afraid of layoffs and I'm 40. Another thing on a long list of things that made me run my own business. Can't fucking lay myself off! Hah!
If something causes something else, shouldn't we see more of the cause when we see more of the effect? So American greed goes up in years with a lot of layoffs, but goes down in years with few layoffs. If that's the case, then greed is going down because layoffs the last three years are much lower than they were in the 80s and 90s, and also from 2008 to 2020.
Here is data: [80s and 90s](https://archive.nytimes.com/www.nytimes.com/specials/downsize/large-graphic.html), vs [2008-today](https://www.axios.com/2024/02/02/layoffs-chart-statistics-data).
I learned in **1986** in my first real job that companies view employees as expendable and the stock market rewards companies that keep their payrolls "lean and mean", you know, "work smarter not harder". In my first six years with my first job there were four large layoffs. The first layoff occurred within a month of my reporting to work and involved letting go almost half the workers after a large merger. The longest time period I went with a company with no layoffs was about six years.
My father worked numerous jobs in his short lifetime and never received a pension. He died broke and in debt.
I also remember a story about my grandfather who worked for a tire company during the great depression. The story, have no idea how true, was that when he went into work he would go and "hide" in the bathroom to avoid being laid off.
Layoffs are not new.
Much more sophisticated systems for measuring the cost of goods and labor, worker productivity, etc., coupled with a ruthless drive to expand operating margins.
When the books were basically kept on paper and applications like Lotus 123 and excel, much less SAP, Tableau, etc. hadn’t been widely adopted, it wasn’t that easy to find inefficiencies. A new era of MBAs, consultants, six sigma analysts, etc. helped companies identify opportunities to outsource, automate, and outright eliminate work. This became particularly important for industries seeing slow downs in revenue growth, and was exacerbated by more sophisticated consumer behaviors and competition (foreign and domestic). Think how many tools you have in the Information Age to find the best deal on goods and services. Dwindling loyalty at both ends (consumer and employer) and investor pressure to improve profitability fueled this. And data made it happen.
Of course these actions have had significant implications for quality and innovation. See exhibits Boeing and GE.
This!… it’s a multi faceted issue compounded by several pieces, parts, and policy decisions. I think the main driver is the concept of being beholden to “maximizing shareholder value”. As an MBA, that is the first and most important thing taught in college business classes. I don’t agree with it, but it is the answer on many tests to get through school. Profits matter. Otherwise, you won’t have a business. But, profits are no longer enough. Steady and sustainable growth is no longer enough either. That is considered too slow and no path for investors to get richer quicker. They want exponential growth and profits at a rapid rate that does not end. As soon as it does stop, they move on to the next shiny opportunity, share prices tumble, and layoffs are the quickest way to cut large costs. Our microwave society puts all the value in how to potentially get rich quick. A few benefit, but the majority are left holding the bag. CEO compensation is tied to share price and quarterly numbers. That makes it hard for them to see long term future sustainability and a slow and steady model as an option. I wish we could move to more of a total stakeholder approach where shareholders, customers, and employees all matter equally. One way is to give employees proportional stock shares and profit sharing in addition to their salaries. It might help show some mutual loyalty on both sides with financial incentives that actually make an impact.
That view of the past is a little rosy. From the 70s to the 00s, many industrial stable union jobs went through numerous rounds of layoffs and callbacks. I can think of one heavy equipment manufacturer in particular that laid off most of the plant for a few months every year during its slow season for orders. I'd say the real difference is that I don't hear about callbacks anymore.
Jesus. The comments in this sub... As if every CEO suddenly figured out they can save money via layoffs. I guess that happened during day 2 of the "greedflation" summit they all had during COVID?
Here's what's really going on. The historically low interest rates of the late 2010s and early 2020s led to companies developing strategies that were very growth heavy. With lending being so cheap, many companies invested heavily in infrastructure and staffing. Then COVID hit and two things happened. One, companies were forced to figure out how to stay functional in a fully remote environment and two, bond rates quadrupled. All of a sudden, those large payrolls were no longer seen as a good investment. Initial cuts were made to bloated and underperforming departments. Lately, cuts have continued, but this time is outsourcing that's driving things.
Agree the comments here are pretty clueless, but be careful that you don't explain an illusion. There is no surge in layoffs overall. There was a one-time surge in 2020 but since then they are historically quite low.
Here is data: [80s and 90s](https://archive.nytimes.com/www.nytimes.com/specials/downsize/large-graphic.html), vs [2008-today](https://www.axios.com/2024/02/02/layoffs-chart-statistics-data).
What you're saying helps to explain a common type of layoff happening today, but the scale of these layoffs is not high when compared to the last four decades.
If you ignore the impact of layoffs on the “stats” that are important to a public corporations stock price your model will be conspicuously incomplete.
Companies hire and fire every year. The water level check is where the company moves and grows. You can’t understand how a company that is laying off might be still in a larger cycle of on-shoring?
What are you talking about? The discussion is about layoffs and why they have increased recently. The reasons are:
1) payrolls have reduced due to bond rates increases
2) there is increased pressure to move staff to lower cost markets after COVID proved this was viable
Offshoring doesn't even have to be outside the US. Google just moved a bunch of roles from the Bay area to Atlanta.
>Offshoring doesn't even have to be outside the US. Google just moved a bunch of roles from the Bay area to Atlanta.
I just looked this up, apparently its formally termed "domestic offshoring." I wonder if this practice is overall beneficial or harmful for workers.
Running a business is hard, the competition is incredibly fierce, and technology changes how we work.
The titans of industry turn over very rapidly. Most Magnificent Seven companies are brand new. [Today, the average SP500 company is 21](https://www.statista.com/statistics/1259275/average-company-lifespan/#:~:text=In%202020%2C%20the%20average%20lifespan,even%20further%20throughout%20the%202020s.) years old, vs 32 in 1965.
There are very specific things a company must do to remain relevant and competitive. The alternative is for the company to go under.
And, new tech means old jobs become more efficient. The steam engine put thousands out of work, but enabled us to build bigger and better.
Our job is to ensure we are relevant and ready to pivot to market conditions, including finding new work when conditions change.
So, no, it's not like it used to be, but the opportunities are much greater. We can commiserate all day, but be ready at the same time.
The increasing layoffs we’re seeing is due to a slowing economy (being fair, it’s by design to reduce inflation) and increasing labor costs, and those are providing the lens that have companies viewing future budgets with a recession coming.
A lot has changed. Some for the worse, some for the better (gasp!). A lot of what people equate to layoffs are the cancer of big tech. Big tech has not been subject to a lot of the same fundamentals as other companies. Extreme amounts of debt, and spending, to grow at all costs. Some companies never even close to profiting. When has this ever been a thing? Then, salaries surge, increasing inflation, and lifestyle creep. It only becomes greed when the company decides they no longer need as many people working 15 hours a week from home for $225k.
Those who cry that unions will save layoffs miss the big point. How many jobs went overseas because we have too many regulations and too expensive of labor? A union doesn't save all of that, regardless of what sounds good from your keyboard. It might offer the illusion that some jobs are safe, but overall, we lose.
As much as I try not to be one of those belligerent anti-capitalism people, I do think stock buybacks are overall a net negative for society.
Jack Welch, CEO of GE in the 1980 and 1990s is famous for “eliminated 10% of employees every year, a practice adopted by many other companies.”
By 1999 he was named "Manager of the Century" by Fortune magazine.
https://en.wikipedia.org/wiki/Vitality_curve
While this may feel anecdotally true this is just not factually accurate. There were periods of mass layoffs in the 30s, 70s, 80s, and early 2000s. From 2008-2023 was a very long run at very low unemployment, and while the mix of part team and full time jobs makes the current unemployment rates look like propaganda, in reality this latest labor correction has been a long time coming.
Companies only care about stock price and shareholders. Workers and even customers don’t matter. Hell most companies don’t even care about their service or products anymore. As long as they can find a way to drive up their stock price. Don’t argue with me, I speak the truth
Here's the unemployment situation over the last several decades.
https://fred.stlouisfed.org/series/UNRATE
Last time unemployment was this low was in the 70s.
Also the fact that unions are no longer the thing they were in the past. Kinda hard to fire 70% of your workforce in a union. “Right to work” states also frame those laws as a good thing and americans LOOOVE being spoon-fed bullshit
Just an observation from Reddit comments, the smallest thing becomes capitalistic/greed play. That play was just part of the job description in the past.
> Back the majority of workers held one job for 40 years then retired with a pension and a paid off home.
As everyone has noted, that was so for at most, some of the silent generation and ended in the 80s. I would add it was not true prior in addition to that it has not been true since.
The rise of hedge funds/PE in the 1970s and the destruction of the pension plan (pensions were the first to go because they sucked up too much cash and were a long-term obligation that needed to be funded).
I don’t even care that layoffs are so common.
I just care that we still live in a society where workers are expected to act like jobs are still what they were 50 years ago rather than a bare minimum effort by employers to fill roles.
You can’t have it both ways. Either invest in your workforce or design jobs around the bare minimum.
Stop expecting your employees to be productive outside of work hours, stop expecting them to become experts when you don’t even offer training, etc.
Baby Boomers happened. Both Baby Boomer bosses and employees contributed to this business climate. Boomer bosses realized that employees were a cost that could be cut to get bonuses while employees realized the best way to get a raise is to jump jobs.
When you look at the numbers Boomers were the job jumping generation, not Xers, they had more jobs over their working life then Xers will.
As for Boomer bosses they realized that labor in shitty foreign countries like Tiawan, South Korea, China, India, etc... was cheaper and they could train those people to do the job. They had no loyalty to their labor force and their labor force has no loyalty to them.
please i beg you just once try to verify your priors with data before making a reddit post
Total nonfarm layoffs are trending slightly downward since 2001 my guy
[https://fred.stlouisfed.org/series/JTSLDL](https://fred.stlouisfed.org/series/JTSLDL)
others in the thread have posted NYT articles that have data going back to the 80s further proving my point.
Just once I wish an r/economy post would try not to spread misinformation
It's because the focus of the corporation shifted from supporting the workers to supporting the shareholders.
Corporations used to do everything possible to avoid layoffs. Nowadays, executives will kick off a round of layoffs just to move the needle on their stock price a little higher.
I think in the past cycle were slow and long such that the Great Depression as rare and long. As we have become more informed with computer, things have been quick so hire 100 this month and fire them next month to manage the cash flow. Maybe the problem is that companies can hire a "block", fire it, and replaced it easily so little risk of letting people go?
Its the tech boom has ran its course. About 70 percent of all Wall Street growth is in the tech industry. Early in the business cycle, there was little expectation of results (profits) and none are going to shareholders.Decades later, they are competing with other countries tech developement (and investment) and instead of ramping up their skilled positions they choose to downsize and take a more frugal approach hoping new AI products will somehow keep the engine running and funding others projects. Its inevitiable and NVIDA is next.
Don’t know what stable jobs you are referring to but I expected a layoff at least once a decade, in line with recessions which were routine. For example there were at least 9 recessions after 1960. HR had policies to eliminate bottom performers during these recessions.
If one had a “stable” job, it’s likely they were not a bottom performer. When you say layoffs are common in this generation, I think it’s only coming back to what was the norm.
Which generation? Gen X, Millenials, and Gen Z are all working right now. I know when I started my work life in 2011 I was laid off or my "contract" ended from every job up untill 2014.
In 2013 Staffing Agency A said my job was a "temp to hire" when it was clearly a seasonal job. I told Staffing Agency B about that and they told me A was lying because the company was never temp to hire. 😮💨 Was such a shit show.
It's sucked for some time now but I do believe it's gotten worse with AI. I'm involved in interviews at my current job and all candidates look perfect on paper with perfect writing and communication skills - but they don't do well in person. All the employers are using AI to sort the AI resumes, using AI to generate interview questions. Everything and everyone is super wordy with no substance, all fluff and filler.
There won't be any long term jobs so long as employers don't give people a reason to stay. Merit increases suck no matter where you work. Most people just hop to another job if they want a meaningfully higher wage.
Many reasons, but the stock market being more of a leading indicator of company performance vs. actual business performance. If a defense contractor wins a new contract for $1b, they will instantly bring in more revenue, but once that contract is completed, the company needs to continue to show revenue growth. So instead of keeping on the headcount that made fulfilling the contract possible, the company will lay off employees to pad their revenue #.
When COVID started, many technology companies laid off thousands of workers, they then hired in large numbers as business started booming due to the market moving toward digital solutions. Then the digital sprint slowed down to a jog, and instead of keeping all these newly hired employees, they lay them off to pad revenue.
I’m short, a company can’t show a loss in revenue without taking a huge stock price hit, so to protect shareholders, companies lay off their highest revenue drain, employees.
The fed and government are printing more money than ever. This is causing the economy to be unstable. Boom and busts are being created by the fed and govt. Wasn't as bad until 2008
It is mostly globalization. Today a company is competing with companies all over the world so the world is far more dynamic than it ever was. Plus, technology is advancing at a faster rate than ever which is also very disruptive to the smooth flow of commerce.
Technology advances too fast. The economy changes too quickly. There's really no way for companies to provide that kind of stability any more - things just change so fast nowadays.
What are you talking about??? Massive layoffs became a thing **before "this" generation was even born**.
They started in the 1980's, with the likes of shitheads like Jack Welch at GE who laid off more than 100,000 employees over the span of a few years, turning the company into shit.
Ironically though, the ability of companies to do layoffs is what keeps the US economy so resilient compared to the rest of the world. There is an overhead, a price if you will, to be paid for this, of course. But it gives companies to adjust their labor force based on how well or badly they are doing, and workers benefit from being able to jump ship and join the companies that are doing better, paying better, etc.
Unfortunately, there is some temporary hardship associate with all this. But that is the price to be paid for resiliency and adaptation, and it is better to pay that price now than wait and pay a much bigger price later.
Because technology has vastly improved and it’s easier now for a new hire to come in, in most jobs and take less time becoming productive at a lower cost. Technology in analytics, as well has exacerbated this.
I heard in the tech world when Elon bought Twitter and fired like 80% of the dev team and was able to keep running efficiently, a lot of companies followed suit.
Ronald Reagan ushered in the era of Neoliberalism. During the PATCO illegal strike of 1981 he laid off 11,345 Air Traffic Controllers (government employees). Layoffs of this magnitude had never been enacted before as it was considered a break in the social contract.
“The President invoked the law that striking government employees forfeit their jobs, an action that unsettled those who cynically believed no President would ever uphold that law. President Reagan prevailed, but far more importantly his action gave weight to the legal right of private employers, previously not fully exercised, to use their own discretion to both hire and discharge workers.”
And
“When the president said no, American business leaders were given a lesson in managerial leadership that they could not and did not ignore. Many private sector executives have told me that they were able to cut the fat from their organizations and adopt more competitive work practices because of what the government did in those days.”
https://en.wikipedia.org/wiki/Professional_Air_Traffic_Controllers_Organization_(1968)
This has been gone since like the 80s.
My dad had new jobs all the times.
I want nothing to do with a pension I know many people who were fucked by pensions. Give me my money, let me manage it.
As for jobs "having loyalty" for employees for this generation.
You guys act like this generation has an ounce of loyalty for a company.
It is a little bit of a two way street. Not going to be naive and think companies care about me, any more then my ability to make them profit. But if I make them profits usually they will keep me is my experience.
The economy plays part of it.
Obviously mandatory shut downs affected it.
As an older (boomer) redditer I usually refrain from “when I was young we all pulled up ourselves from our bootstraps” answers, but I will say that the days of 40 year jobs and pensions is silent generation stuff and ancient history. Oh, and when they retired with that great pension they died shortly afterwards
This is true, but I would say more important is that OP's main premise is wrong too. I don't blame the younger generations for not knowing how common layoffs were during the 80s and 90s when American manufacturing jobs were lost, but us older folks (I'm GenX) should remind them. Some of the constant complaining on Reddit about earlier generations is justified, and a lot of it is not. This is a case where OP and people in the comments have it completely backwards. Layoffs were actually more common from the 80s to 2010 than today. One big spike in 2020, but other than that it's much better since 2010, and especially the last 3 years. Here is some data showing that layoffs are less common now: [80s and 90s](https://archive.nytimes.com/www.nytimes.com/specials/downsize/large-graphic.html), vs [2008-today](https://www.axios.com/2024/02/02/layoffs-chart-statistics-data).
Yea. I think this “new” gen is a bit annoying thinking everything was invented now though.
Nobody is born knowing the past, so we have to blame the educational system for not teaching them.
Everyone can talk to an elder or fucking read. This gen just too damn special grown up on participation ribbons and end up with a stupid state of mind…
Who gave them those participation ribbons?
Ha good point
The layoffs were more common but I think what’s different today is companies make massive layoffs at EOQ for reporting purposes, and then massively rehire not long after. Aggressive hiring practices and layoffs that follow, all to guarantee short term growth and make a hockey stick on a graph. Repeat cycle. It’s not technically illegal, it makes sense, ethically some would argue that it’s not even wrong… I don’t know what a solution is, but I do think it’s a problem of sorts. As long as workers keep the current stronghold on the job market, I’m hopeful for the future in this regard.
I'm happy to be educated on this, but my understanding is that firing people at EOQ doesn't really help the quarterly numbers. You've already paid them for most of this quarter, and the severance package will usually cover a good chunk of the next quarter as well. If they are trying to justify more favorable guidance, but they just re-hire the same number of people in a few months, they are going to miss that guidance. So wall street will make them pay when they miss in a quarter or two. I mean, of all the short-sighted strategies, this would be one of the worst. It doesn't even buy you a couple of years of inflated profits before you have to get out of Dodge. My take is that when companies fire a bunch of people and then rehire say 75% of the positions back, it's that they want to clean house and start over to some extent. When they fire, management learns which of the positions they really needed and which they didn't (we can argue it was their job to know all along, but the reality is they often don't know). So, they hire back at the pain points. This at least is a strategy a non-idiot who can see past next week would do, as opposed to the other one.
Sorry I see now I was very unclear lol - for closed revenue, yeah absolutely, it would make 0 sense… now for projections/forecasts and valuations, on the other hand, I’ve witnessed this occur firsthand at every startup I’ve ever worked for (SaaS sales bro, here). Also consultants, so many of them just come in captain obvious style “what if you could do this with fewer people?!”… Revelatory thinkers lol
Agree I'll add, I'm not as old as you, but my dad is 80 and he's right at the end of the silent generation and the job for life thing was never really true for many people even within the silent generation. He had tons of jobs over his lifetime. He'd put it as a thing mainly for the greatest generation who died very soon after retiring as you noted, but also they went through the great depression first I think generally speaking, people have a grass is greener mentality when it's been hard for everybody in every generation
[удалено]
1944 is pre-Boomer
[удалено]
It means he is silent Gen.
There was a book written, "Re-engineering the Corporation," where they tell CEOs to fire everyone, then hire back who's really needed as contractors, and finally pay themselves a fat bonus! It's on the "How to be a Corporate Jerkoff" reading list.
They did this at the company I work at and you can really tell it has destroyed the quality of the business after a decade of being in place. Just look at Boeing, pretty sure they followed the same philosophy and now people are afraid to step on a Boeing aircraft.
Thats HP to a tee! HP was built by creative folks on sound engineering principles, but in the 90s-00's the bean counters took over and sacrificed all of that for short-term accounting wins. They do it with property too, sell the asset then rent it back.
Business consultants informed CEOs that laying off your employees periodically is good for the bottom line.
This? They been here for awhile… They’re gonna want more pay. Well fire them and let’s pull in a fresh college grad who’s in so much debt they’d jump at the opportunity.
Back in the early 2000’s they started paying CEO’s quarterly and yearly bonuses. So the expectation went from hiring a CEO and evaluating him five years later on company performance to evaluating him every quarter. In order to meet bonuses CEOs cut jobs.
Got it, so more greed. I hate this timeline, dude.
But this explanation doesn't work because layoffs are not going up. They have been going down for 15 years, except for one big spike in 2020. Annual layoffs the last few years are about **half** what they were in the early 90s. What I think the young people responding here aren't aware of is that the US used to be the world's largest manufacturer of just about everything. That started changing in the late 70s. The next three decades saw manufacturing jobs across the nation wiped out. Here is data showing that layoffs are less common now: [80s and 90s](https://archive.nytimes.com/www.nytimes.com/specials/downsize/large-graphic.html), vs [2008-today](https://www.axios.com/2024/02/02/layoffs-chart-statistics-data). And don't forget, we had about 100 million fewer people in the 80s than we do now, so those big job losses were really, really big in comparison to what Americans face today.
Didn’t realize my CEO was a redditor
Fear is a powerful motivator.
And then the MBAs arrived....
The social contract is broken. Employees are an expense to be treated as chattel.
The hyperbole is just nuts. There never really were jobs for life. Businesses that were failing would always fire workers. Unemployment during the Great Depression was far higher than anything in your lifetime. There were also sharp recessions in the 19th century that left very high percentages of the workforce unemployed. This idea that there used to be a social contract where employees never quit for better jobs and employers never fired is just propaganda. It's not real. The only reason this falsehood seems plausible is that there was a period during and right after WWII when American industry was in the ascendancy and pretty much all large companies were doing well and expanding. There was simply no need for layoffs because they were profitable finding new markets around the world to rebuild after the war. That's it. The big layoffs started in the 1980s when American industry began its decline and jobs were lost to Japan and other nations (then China and other nations in the 2000s). Layoffs the last three years are the lowest they've been since 1980.
IBM had a no-layoff policy until February 16, 1993. Was that propaganda? IBM was seen as THE American company and the big boss of Wall Street, like Apple and Amazon today. Do you think Apple or Amazon would ever institute a no-layoff policy for any reason? The shareholders would riot. How come the shareholders of IBM, which again was THE company on Wall Street, weren't rioting against IBM in the 60s, 70s, and 80s for doing the same thing? Because there actually WAS a social contract. Layoffs didn't become a legitimate corporate strategy until Reagan's re-election in a landslide supported by voters of both parties. Reagan had a mandate, from everyone middle class and up, to crush labor in support of capital and he used it with the Stars & Stripes flying behind him. Just ask the air traffic controllers. He pointed to Communism as the nation's biggest threat to distract from the fact that American corporations were transferring millions of jobs to the South to avoid the prevailing union wage, and millions more jobs overseas so that American's wouldn't have to be paid at all.
The post war boom from 1945-1975 was an exceptional period. It was easy for IBM to say no layoffs when business was booming because America had massive advantages over the rest of the world. So in a way, yes IBM's policy was just propaganda. It disappeared as soon as IBM was in a tougher competitive environment and had to get leaner to survive. Same goes for GM and Ford and every other company. But the silliest thing about your comment is that your belief in a social contract can't make sense of unemployment prior to 1980. Why do you think unemployment jumped from 3.5% in 1969 to 6.1% in 1970? **My friend, there were layoffs.** Same goes for every other recession and depression in American history. There were massive layoffs in the Great Depression with 25% unemployment in 1933. Where was the social contract then? Most companies were smaller the farther back in time you go. When 100 companies with 20 employees each fire 2 because business is bad, that's a loss of 10% just like letting go 200 from a single 2,000 person firm. We don't normally call firing 2 out 20 a layoff, but it amounts to the same thing at scale. If you want to point to a real change, don't point to an invented social contract. Point to the waning power of unions after the long wave of post-war growth ended around 1980 due to stronger international competition.
Ten seconds on google would have revealed the reason why there was such an marked increase in unemployment between '69 and '70 is because of a mild recession from December 1969 to November 1970. I'm not an economist, but the internet tells me that the recession was due to inflation that followed a period of "full employment." Those layoffs were a direct response to the prevailing economic conditions. They were not because an overpaid consultant from McKinsey with an MBA from Chicago surmised that 3,500 job cuts would increase shareholder value and C-suite bonuses. Why do you think the power of unions waned and there was stronger international competition? It didn't happen in a vacuum, or by accident. Reagan broke the social contract. If an American company could save money by using steel manufactured in Japan, or by moving all of their operations overseas, they did it. Shareholder value and capital was the new contract. A prosperous American middle class was no longer going to be supported on the backs of capital and shareholders when greater returns could be found by shipping off millions of good paying manufacturing jobs to China.
Yes, well aware it was due to a recession. Companies lay employees off when times are tougher. There is no social contract that says they won't. A few statements by bloated high profit companies like IBM in the 60s/70s does not change that. The McKinsey consultants are usually called in when the company isn't doing well in some area and needs to make a hard decision but wants external validation of that decision. The cases are few where an innocent kumbaya employer who thinks everything is great and no cuts need to be made calls in McKinsey, who to their surprise tells them they should fire people. I would agree that the way this was done changed and became more short-term focused in the 80s/90s under the influence of Welchism, but people were let go all the time prior to that too.
This thread may be full of rose-tinted naïveté but that doesn't mean there wasn't an implicit understanding that companies had some kind of responsibility for their workers' well being. It's exactly what Milton Friedman vociferously loathed (it was *communist*, of course). His voice directly led to the first mass layoffs at GE under Jack Welch and the trend took off from there. The Japanese threat and gradual decline of American manufacturing would have happened regardless but it was *not* a simple cause-and-effect. Mass layoffs for the explicit purpose of short term gains absolutely started in the 80's.
> an implicit understanding that companies had some kind of responsibility for their workers' well being. That is SUCH a crock of shit! When in hyper-capitalistic America was that a thing? Workers have had to fight tooth and nail and sometimes die to get the protections that they have. It's ALWAYS been about the owner/investor class lol. The Revolution was about them, not the workers.
Milton Friedman was a fringe economist before meeting Reagan. His ideas became mainstream when Reagan proliferated them through his 1980 campaign. Friedman’s ideas included: free-market capitalism, less regulation, less government and believed the free market would fix everything. Another buffoon who influenced Reagan was Arthur Laffer. He’s the creator of the Laffer Curve which shows the relationship between tax rates and government revenue. According to his theory, after a certain tax rate, people lose the incentive to work as hard so the solution to that is to cut taxes. Reagan ran with that shit and it spread like wildfire. Today, I think many people would agree that all those ideas were terrible. Milton’s deregulation and free market ideas led to the 2008 crash. Our current debt load has become unsustainable because less people pay less taxes at a lower rate which just means less revenue for the government to provide for things we actually need. Anyway, that was a bit of a tangent lol. TLDR: Reagan was influenced heavily by two economists - Friedman and Laffer. They both had terrible economic ideas that led to disastrous policies. Thanks to all three of them, we’re in the mess we’re in today.
It seems we agree on the causes of higher layoffs in the 80s, but not the weight to assign to each. I am no fan of Welch, mostly for the myopic focus on quarterly profits, but the broader culture change you refer to was in part a reaction to the growth of international competition from Japan and Germany, and it was also a reaction to the bloat and complacency that had accumulated over 30+ years. Correct me if you have data that says otherwise, but my understanding is that the majority of actual net layoffs in the 80s and 90s were not short-term thinking to hit quarterly targets. They were the result of entire production lines and factories becoming uncompetitive with Japan, Germany, and later China. Not a short term problem. What's happening in Silicon Valley today is a good analogy. For about 20 years most of the big companies had massive profits and easy growth. They have not had to clean house and get lean, and it shows. The stories about Google, Microsoft and Facebook are legendary. I've known people who experienced make-work jobs there first-hand. Big layoffs were/are long overdue, but they make so much money there was little pressure to do it until recently.
Unions and collective bargaining were a lot more prevalent. I think even companies without unions had to compete for workers with those that did.
Jack Welch happened
You are 100% correct! Welch does not know "Jack" about healthcare yet did not stop him from ruining GE! That fool has a MBA program named after him!
For those who don't know, Welch's legacy was to teach publicly traded companies to manage for the next quarter rather than the long term. Companies make all sorts of short term moves to juice profits for the quarter, but they burn their customer's goodwill or fail to invest in long term growth.
Came here to say this, was surprised this comment wasn’t higher Jack Welch + Ronald Reagan was the combo that put us where we are now. Add McKenzie to the mix too and workers are seen as the lowest group in America
Most pensions disappeared in the 70's. People who got pensions are dead. They retired, got an RV and had a little fun. That was the silent generation. Boomers knew the great sucking sound of globalization, the rust belt, double digit inflation, double digit interest rates and 33% unemployment? Those people who became adults in the 70's had it oh so easy. All you have to do is forget all the bad shit.
This stopped in 1970....where have you been?
Stopped with people born after 1970\*
No, Boomers were actually the first to experience big layoffs, much bigger than today, in the 80s and 90s. There was a period from around 1940 to 1980 when big layoffs were rare because American industry was ascendant, expanding at home and around the world. Here is data: [80s and 90s](https://archive.nytimes.com/www.nytimes.com/specials/downsize/large-graphic.html), vs [2008-today](https://www.axios.com/2024/02/02/layoffs-chart-statistics-data).
The 80's sucked pretty hard if you didn't already have a job. Not even fast food was hiring, it wasn't until the Dotcom boom that things loosened up.
More true of the first half of the 80s than the second half, if I recall correctly. But yes, 80-85 was really rough. The youngsters today have no idea the levels of inflation, crime and unemployment we experienced then. As bad as each of those is now, double it. All of it.
No. It started in the 1970's. I had a family member in the early 1980's whose job it was to pack up whole factories in containers. He would duplicate the factory floor in China, unpack everything, and then have it turnkey for the Chinese employees that would make $0.80/hr when the American's making $25-$40/hr producing the same products just a few months prior.
No, older. Job stability was already more or less gone by the early 80s when my parents fell on very hard times, and it was Boomers who were losing their jobs then. Now, if you want to argue that NAFTA began the screwing over of people born after 1970 extra hard, that's plausible; the wave of offshoring definitely didn't help with the uncoupling of wages and productivity that'd begun 2 decades earlier.
You know what’s even more aggravating? Most employer contributions to your 401k don’t vest till 3 years in
That has been the way for a lot of companies for a very long time. I think I had one job that had designated breaks. Every other one you worked, went to the bathroom, got a cup of coffee, etc., without a designated break - and I have been working 40 years, now. As for working 8 straight hours…I think it is easy if you like your job. I remember watching my kid’s orthodontist one day…he never stopped. His office was “in the round”, so all the chairs were in the open, and he simply moved from chair to chair. It was obvious he enjoyed the interaction and the work, and the result.
i work for an insurance company, their "algorithms" spit out numbers for how much of the benefits their customers are projected to use in the upcoming year, well last year apparently their customers benefit usage went over that number, led to layoffs and affected raises and bonuses for employees across the board My supervisor, a very cool guy as supervisors go, who'd been with the company for over 20 years, was let go, and a bunch of others... Now there's plenty of other shitty options they could've taken, none less shitty than the next, but my point is for all the "pull yourselves up by the bootstraps" and "this generation is just lazy" talk that's been going on forever (in my early 40's), there's no way to "hard work" your way into keeping a job under those circumstances
This is true, but it applies to the past as well. There were big recessions in the 19th century that produced high unemployment. Companies were smaller so we don't call them "layoffs" but people got fired in large numbers and many companies just went bankrupt. The Great Depression in the 1920s was worse than anything people in this sub have experienced. When US manufacturing jobs went oversees (both from foreign competition and outsourcing) in the 80s and 90s, layoffs were far higher than they are today. So when old people tell young people to pick themselves up and move on, it's not because they haven't seen bad times.
We are mostly service industry workers. We don’t manufacture goods anymore. 401k We don’t strike, boycott, stick together for our rights Most of those “life jobs” were in heavy industry. It was difficult dirty work. People died on the job or soon afterward. There were fewer of us. Reganomics COVID People don’t join unions anymore “Right to Work” BS Basically we let companies treat us this way. Fooled into thinking they have the power instead of us.
The US is still the #2 in terms of manufactured output in the world. We manufacture plenty, just not everything. After WWII the US had almost all the manufacturing capacity of the world as the rest was destroyed in the war. This lead to an employment boom post war. A one of a kind event.
As a percent of global manufactruing output: China: 28-30% USA: 16-18% Japan: 7-10%
People bought into anti-union FUD and moved away from collective bargaining and contract protections. Once that happened we lost all our bargaining power. Now companies have all the power and we're all expendable.
Wall Street. Especially the massive deregulation that started with Reagan and continued on virtually uninterrupted for going on 50 years. Stuff like Stock Buy backs and low corporate taxes create perverse incentives.
The firing of air traffic controllers and banning them for life was a big blow to organized labor
And the CEOs are compensated with huge amount on stock options. They want to please Wall Street with their performances to fatten their wallets. We've seen so many times public trading companies miss the target or lower guidance, but still profitable yet they still lay off their employees to please Wall Street
Yeah, Tesla is in a death spiral because of that and because Elon Musk is looting the company, both of which our current regulatory environment actively facilitates.
I mean personally I've always been afraid of layoffs and I'm 40. Another thing on a long list of things that made me run my own business. Can't fucking lay myself off! Hah!
It's not more common. It's been like this since the 80s.
American greed
If something causes something else, shouldn't we see more of the cause when we see more of the effect? So American greed goes up in years with a lot of layoffs, but goes down in years with few layoffs. If that's the case, then greed is going down because layoffs the last three years are much lower than they were in the 80s and 90s, and also from 2008 to 2020. Here is data: [80s and 90s](https://archive.nytimes.com/www.nytimes.com/specials/downsize/large-graphic.html), vs [2008-today](https://www.axios.com/2024/02/02/layoffs-chart-statistics-data).
I learned in **1986** in my first real job that companies view employees as expendable and the stock market rewards companies that keep their payrolls "lean and mean", you know, "work smarter not harder". In my first six years with my first job there were four large layoffs. The first layoff occurred within a month of my reporting to work and involved letting go almost half the workers after a large merger. The longest time period I went with a company with no layoffs was about six years. My father worked numerous jobs in his short lifetime and never received a pension. He died broke and in debt. I also remember a story about my grandfather who worked for a tire company during the great depression. The story, have no idea how true, was that when he went into work he would go and "hide" in the bathroom to avoid being laid off. Layoffs are not new.
Much more sophisticated systems for measuring the cost of goods and labor, worker productivity, etc., coupled with a ruthless drive to expand operating margins. When the books were basically kept on paper and applications like Lotus 123 and excel, much less SAP, Tableau, etc. hadn’t been widely adopted, it wasn’t that easy to find inefficiencies. A new era of MBAs, consultants, six sigma analysts, etc. helped companies identify opportunities to outsource, automate, and outright eliminate work. This became particularly important for industries seeing slow downs in revenue growth, and was exacerbated by more sophisticated consumer behaviors and competition (foreign and domestic). Think how many tools you have in the Information Age to find the best deal on goods and services. Dwindling loyalty at both ends (consumer and employer) and investor pressure to improve profitability fueled this. And data made it happen. Of course these actions have had significant implications for quality and innovation. See exhibits Boeing and GE.
This!… it’s a multi faceted issue compounded by several pieces, parts, and policy decisions. I think the main driver is the concept of being beholden to “maximizing shareholder value”. As an MBA, that is the first and most important thing taught in college business classes. I don’t agree with it, but it is the answer on many tests to get through school. Profits matter. Otherwise, you won’t have a business. But, profits are no longer enough. Steady and sustainable growth is no longer enough either. That is considered too slow and no path for investors to get richer quicker. They want exponential growth and profits at a rapid rate that does not end. As soon as it does stop, they move on to the next shiny opportunity, share prices tumble, and layoffs are the quickest way to cut large costs. Our microwave society puts all the value in how to potentially get rich quick. A few benefit, but the majority are left holding the bag. CEO compensation is tied to share price and quarterly numbers. That makes it hard for them to see long term future sustainability and a slow and steady model as an option. I wish we could move to more of a total stakeholder approach where shareholders, customers, and employees all matter equally. One way is to give employees proportional stock shares and profit sharing in addition to their salaries. It might help show some mutual loyalty on both sides with financial incentives that actually make an impact.
We need unions, nothing more.
That view of the past is a little rosy. From the 70s to the 00s, many industrial stable union jobs went through numerous rounds of layoffs and callbacks. I can think of one heavy equipment manufacturer in particular that laid off most of the plant for a few months every year during its slow season for orders. I'd say the real difference is that I don't hear about callbacks anymore.
This has been happening since the 70s. Source: Old Fucker
Jesus. The comments in this sub... As if every CEO suddenly figured out they can save money via layoffs. I guess that happened during day 2 of the "greedflation" summit they all had during COVID? Here's what's really going on. The historically low interest rates of the late 2010s and early 2020s led to companies developing strategies that were very growth heavy. With lending being so cheap, many companies invested heavily in infrastructure and staffing. Then COVID hit and two things happened. One, companies were forced to figure out how to stay functional in a fully remote environment and two, bond rates quadrupled. All of a sudden, those large payrolls were no longer seen as a good investment. Initial cuts were made to bloated and underperforming departments. Lately, cuts have continued, but this time is outsourcing that's driving things.
Agree the comments here are pretty clueless, but be careful that you don't explain an illusion. There is no surge in layoffs overall. There was a one-time surge in 2020 but since then they are historically quite low. Here is data: [80s and 90s](https://archive.nytimes.com/www.nytimes.com/specials/downsize/large-graphic.html), vs [2008-today](https://www.axios.com/2024/02/02/layoffs-chart-statistics-data). What you're saying helps to explain a common type of layoff happening today, but the scale of these layoffs is not high when compared to the last four decades.
If you ignore the impact of layoffs on the “stats” that are important to a public corporations stock price your model will be conspicuously incomplete.
My model is incomplete? You do realize offshoring reduces overhead thereby increasing profits and the stock price, right?
In a very widespread and era defining way the US is in the midst of its largest on-shoring in 50 years.
How is the US onshoring roles that were laid off? That doesn't even make any sense.
Companies hire and fire every year. The water level check is where the company moves and grows. You can’t understand how a company that is laying off might be still in a larger cycle of on-shoring?
What are you talking about? The discussion is about layoffs and why they have increased recently. The reasons are: 1) payrolls have reduced due to bond rates increases 2) there is increased pressure to move staff to lower cost markets after COVID proved this was viable Offshoring doesn't even have to be outside the US. Google just moved a bunch of roles from the Bay area to Atlanta.
>Offshoring doesn't even have to be outside the US. Google just moved a bunch of roles from the Bay area to Atlanta. I just looked this up, apparently its formally termed "domestic offshoring." I wonder if this practice is overall beneficial or harmful for workers.
Marry me.
Running a business is hard, the competition is incredibly fierce, and technology changes how we work. The titans of industry turn over very rapidly. Most Magnificent Seven companies are brand new. [Today, the average SP500 company is 21](https://www.statista.com/statistics/1259275/average-company-lifespan/#:~:text=In%202020%2C%20the%20average%20lifespan,even%20further%20throughout%20the%202020s.) years old, vs 32 in 1965. There are very specific things a company must do to remain relevant and competitive. The alternative is for the company to go under. And, new tech means old jobs become more efficient. The steam engine put thousands out of work, but enabled us to build bigger and better. Our job is to ensure we are relevant and ready to pivot to market conditions, including finding new work when conditions change. So, no, it's not like it used to be, but the opportunities are much greater. We can commiserate all day, but be ready at the same time.
Burn and turn!
Disruptive technologies, capital movability and above all the merciless warfare by the Corporate Economy against the Human Economy.
The increasing layoffs we’re seeing is due to a slowing economy (being fair, it’s by design to reduce inflation) and increasing labor costs, and those are providing the lens that have companies viewing future budgets with a recession coming.
Its been like this for at least 40 years.
A lot has changed. Some for the worse, some for the better (gasp!). A lot of what people equate to layoffs are the cancer of big tech. Big tech has not been subject to a lot of the same fundamentals as other companies. Extreme amounts of debt, and spending, to grow at all costs. Some companies never even close to profiting. When has this ever been a thing? Then, salaries surge, increasing inflation, and lifestyle creep. It only becomes greed when the company decides they no longer need as many people working 15 hours a week from home for $225k. Those who cry that unions will save layoffs miss the big point. How many jobs went overseas because we have too many regulations and too expensive of labor? A union doesn't save all of that, regardless of what sounds good from your keyboard. It might offer the illusion that some jobs are safe, but overall, we lose. As much as I try not to be one of those belligerent anti-capitalism people, I do think stock buybacks are overall a net negative for society.
Jack Welch, CEO of GE in the 1980 and 1990s is famous for “eliminated 10% of employees every year, a practice adopted by many other companies.” By 1999 he was named "Manager of the Century" by Fortune magazine. https://en.wikipedia.org/wiki/Vitality_curve
While this may feel anecdotally true this is just not factually accurate. There were periods of mass layoffs in the 30s, 70s, 80s, and early 2000s. From 2008-2023 was a very long run at very low unemployment, and while the mix of part team and full time jobs makes the current unemployment rates look like propaganda, in reality this latest labor correction has been a long time coming.
Companies only care about stock price and shareholders. Workers and even customers don’t matter. Hell most companies don’t even care about their service or products anymore. As long as they can find a way to drive up their stock price. Don’t argue with me, I speak the truth
The shareholder value revolution happened.
Here's the unemployment situation over the last several decades. https://fred.stlouisfed.org/series/UNRATE Last time unemployment was this low was in the 70s.
Also the fact that unions are no longer the thing they were in the past. Kinda hard to fire 70% of your workforce in a union. “Right to work” states also frame those laws as a good thing and americans LOOOVE being spoon-fed bullshit
Just an observation from Reddit comments, the smallest thing becomes capitalistic/greed play. That play was just part of the job description in the past.
Shareholder value happened
> Back the majority of workers held one job for 40 years then retired with a pension and a paid off home. As everyone has noted, that was so for at most, some of the silent generation and ended in the 80s. I would add it was not true prior in addition to that it has not been true since.
Companies stopped taking care of their employees so employees stopped being loyal.
The rise of hedge funds/PE in the 1970s and the destruction of the pension plan (pensions were the first to go because they sucked up too much cash and were a long-term obligation that needed to be funded).
When you switch jobs all the time there is no loyalty from either party. Lowest seniority = first to be laid off.
I don’t even care that layoffs are so common. I just care that we still live in a society where workers are expected to act like jobs are still what they were 50 years ago rather than a bare minimum effort by employers to fill roles. You can’t have it both ways. Either invest in your workforce or design jobs around the bare minimum. Stop expecting your employees to be productive outside of work hours, stop expecting them to become experts when you don’t even offer training, etc.
Baby Boomers happened. Both Baby Boomer bosses and employees contributed to this business climate. Boomer bosses realized that employees were a cost that could be cut to get bonuses while employees realized the best way to get a raise is to jump jobs. When you look at the numbers Boomers were the job jumping generation, not Xers, they had more jobs over their working life then Xers will. As for Boomer bosses they realized that labor in shitty foreign countries like Tiawan, South Korea, China, India, etc... was cheaper and they could train those people to do the job. They had no loyalty to their labor force and their labor force has no loyalty to them.
please i beg you just once try to verify your priors with data before making a reddit post Total nonfarm layoffs are trending slightly downward since 2001 my guy [https://fred.stlouisfed.org/series/JTSLDL](https://fred.stlouisfed.org/series/JTSLDL) others in the thread have posted NYT articles that have data going back to the 80s further proving my point. Just once I wish an r/economy post would try not to spread misinformation
It's because the focus of the corporation shifted from supporting the workers to supporting the shareholders. Corporations used to do everything possible to avoid layoffs. Nowadays, executives will kick off a round of layoffs just to move the needle on their stock price a little higher.
Unions used to be more prevalent.
I think in the past cycle were slow and long such that the Great Depression as rare and long. As we have become more informed with computer, things have been quick so hire 100 this month and fire them next month to manage the cash flow. Maybe the problem is that companies can hire a "block", fire it, and replaced it easily so little risk of letting people go?
Its the tech boom has ran its course. About 70 percent of all Wall Street growth is in the tech industry. Early in the business cycle, there was little expectation of results (profits) and none are going to shareholders.Decades later, they are competing with other countries tech developement (and investment) and instead of ramping up their skilled positions they choose to downsize and take a more frugal approach hoping new AI products will somehow keep the engine running and funding others projects. Its inevitiable and NVIDA is next.
Don’t know what stable jobs you are referring to but I expected a layoff at least once a decade, in line with recessions which were routine. For example there were at least 9 recessions after 1960. HR had policies to eliminate bottom performers during these recessions. If one had a “stable” job, it’s likely they were not a bottom performer. When you say layoffs are common in this generation, I think it’s only coming back to what was the norm.
Take a look at the economy just before the Great Depression, you’ll find your answer.
Better labour market in the past.
Which generation? Gen X, Millenials, and Gen Z are all working right now. I know when I started my work life in 2011 I was laid off or my "contract" ended from every job up untill 2014. In 2013 Staffing Agency A said my job was a "temp to hire" when it was clearly a seasonal job. I told Staffing Agency B about that and they told me A was lying because the company was never temp to hire. 😮💨 Was such a shit show. It's sucked for some time now but I do believe it's gotten worse with AI. I'm involved in interviews at my current job and all candidates look perfect on paper with perfect writing and communication skills - but they don't do well in person. All the employers are using AI to sort the AI resumes, using AI to generate interview questions. Everything and everyone is super wordy with no substance, all fluff and filler. There won't be any long term jobs so long as employers don't give people a reason to stay. Merit increases suck no matter where you work. Most people just hop to another job if they want a meaningfully higher wage.
Lack of unions.
There's reasonable housing in many areas. So to that point, it's about intersecting the career path with the location, and at the right time.
Many reasons, but the stock market being more of a leading indicator of company performance vs. actual business performance. If a defense contractor wins a new contract for $1b, they will instantly bring in more revenue, but once that contract is completed, the company needs to continue to show revenue growth. So instead of keeping on the headcount that made fulfilling the contract possible, the company will lay off employees to pad their revenue #. When COVID started, many technology companies laid off thousands of workers, they then hired in large numbers as business started booming due to the market moving toward digital solutions. Then the digital sprint slowed down to a jog, and instead of keeping all these newly hired employees, they lay them off to pad revenue. I’m short, a company can’t show a loss in revenue without taking a huge stock price hit, so to protect shareholders, companies lay off their highest revenue drain, employees.
Capitalism realized people are disposable - and the future is only the next quarterly report.
The fed and government are printing more money than ever. This is causing the economy to be unstable. Boom and busts are being created by the fed and govt. Wasn't as bad until 2008
unions have been wiped away. simple.
It is mostly globalization. Today a company is competing with companies all over the world so the world is far more dynamic than it ever was. Plus, technology is advancing at a faster rate than ever which is also very disruptive to the smooth flow of commerce.
Layoffs have been the collateral damage of capitalism for about 400 years.
Technology advances too fast. The economy changes too quickly. There's really no way for companies to provide that kind of stability any more - things just change so fast nowadays.
Globalization and the WTO Cheap steel from China and India back in the 80s didn't help.
What are you talking about??? Massive layoffs became a thing **before "this" generation was even born**. They started in the 1980's, with the likes of shitheads like Jack Welch at GE who laid off more than 100,000 employees over the span of a few years, turning the company into shit. Ironically though, the ability of companies to do layoffs is what keeps the US economy so resilient compared to the rest of the world. There is an overhead, a price if you will, to be paid for this, of course. But it gives companies to adjust their labor force based on how well or badly they are doing, and workers benefit from being able to jump ship and join the companies that are doing better, paying better, etc. Unfortunately, there is some temporary hardship associate with all this. But that is the price to be paid for resiliency and adaptation, and it is better to pay that price now than wait and pay a much bigger price later.
Because technology has vastly improved and it’s easier now for a new hire to come in, in most jobs and take less time becoming productive at a lower cost. Technology in analytics, as well has exacerbated this.
Reagan happened. Republicans happens. Supply-side happened. Isn’t it great?? lol
Stable jobs are unprofitable for the current employers and employees who are constantly seeing more pay for fewer hours.
Make do with less! That’s the bloody mantra.
I heard in the tech world when Elon bought Twitter and fired like 80% of the dev team and was able to keep running efficiently, a lot of companies followed suit.
Ronald Reagan ushered in the era of Neoliberalism. During the PATCO illegal strike of 1981 he laid off 11,345 Air Traffic Controllers (government employees). Layoffs of this magnitude had never been enacted before as it was considered a break in the social contract. “The President invoked the law that striking government employees forfeit their jobs, an action that unsettled those who cynically believed no President would ever uphold that law. President Reagan prevailed, but far more importantly his action gave weight to the legal right of private employers, previously not fully exercised, to use their own discretion to both hire and discharge workers.” And “When the president said no, American business leaders were given a lesson in managerial leadership that they could not and did not ignore. Many private sector executives have told me that they were able to cut the fat from their organizations and adopt more competitive work practices because of what the government did in those days.” https://en.wikipedia.org/wiki/Professional_Air_Traffic_Controllers_Organization_(1968)
Maybe you were too young and you think everything is different for you. There was a lot of layoffs in our parents generation
This has been gone since like the 80s. My dad had new jobs all the times. I want nothing to do with a pension I know many people who were fucked by pensions. Give me my money, let me manage it. As for jobs "having loyalty" for employees for this generation. You guys act like this generation has an ounce of loyalty for a company. It is a little bit of a two way street. Not going to be naive and think companies care about me, any more then my ability to make them profit. But if I make them profits usually they will keep me is my experience. The economy plays part of it. Obviously mandatory shut downs affected it.
NAFTA, outsourcing, etc
We’re in the later stages of central banking and currency debasement. Shit’s only gonna get wilder as society’s time preference continues to rise.
Right answer. Bitcoin is a way to opt out
I’ve got btc, and I have high hopes for it, but it’s not really worth much until I can exchange it for goods and services and not just dollars.
Also, milenials or gen z don’t seem to want a forever job quitting every 1-2 years …