Holiday layoffs. Why now and why always the middle tier that gets the axe?
December 5, 2016
He’s making his list…
We read about holiday layoffs in the trades. Perhaps we experience them in our lives. A grim subject, I know. For I have been on both sides of this sad equation. What I’m about to tell you may not be morally right or wrong but it is a matter of fact.
First, a note on the obvious. Nobody likes to fire people. Especially during the holidays. We forget that, in the rush to create demons. Still, firing is better than being fired. Like I said: obvious.
Why now and why always the middle tier that gets it? Well, Virginia…
Since August, the CFO of your agency has been warning the CEO that the numbers are down. Way down. The CEO, being a glass half full guy, advises restraint in pushing the panic button – don’t want to alarm the troops or start any rumors! Besides, he says, the tide will turn. There’s still that pitch. They debate behind closed doors. Alas, come November, the shortfall is now impossible to ignore. Budget reports are due and the agency is, let’s say, $750,000 dollars below its target. And so the CEO calls together his or her management team: Managing Director, ECD, Head of Planning. A dour PPT ensues. New business did not come in. Organic growth was less than expected. Yada, yada, yada. To sum up, the CEO requests that every department cut a portion of overhead, say 250k each.
The Management Team goes off to their respective corners and creates a “list.” Rather than fire 5 junior people to arrive at his number the executive invariably chooses the highest salaried person he can do without. She figures she can pick up the slack or more likely beat it out of the kids. That, and it’s a hell of a lot easier to let go one person versus doing five. A couple ACD’s. An Account Sup. Two Senior Planners. Throw in that loose cannon from the production department. And Boom. A half dozen souls doomed. If the shortfall is bigger then so will the body count. By the time HR has the necessary paperwork completed it’s after Thanksgiving and just before Christmas. The result is another Black Friday.
Here’s the kicker, in case you missed it. Since the senior-most people were asked to create these lists that means neither they nor the askers appear on them. Gadzooks! This is perhaps unfair – it may very well be that one or two of them are the reason the agency is ailing in the first place. Likely even. What is certainly unfair is having now arrived at their targets the senior executives qualify for a bonus. You may ask, could not the bonus pool have filled the shortfall, sparing jobs? Nope. Because that money comes from “separate buckets.” That last piece has been explained to me several times but I still don’t get it.
Economics and ego. The result is not unlike a third world country, or a sweat shop: a minority of leaders bossing a majority of juniors. Of course there are exceptions but not enough and less so every year. Maybe that’s why so many holiday parties get out of hand… because tomorrow we die.
Not the only ones: http://money.cnn.com/2016/12/20/news/companies/christmas-layoffs/index.html
Like many brethren I’m doing freelance and can provide superior content creation as well as creative leadership: https://steffanwork.wordpress.com/