Recession tales: The workplace is changing forever
Work furloughs are common, pay cuts are mandated to save jobs from being eliminated, four-day work weeks are gaining popularity, and companies are cutting benefits such as matching 401(k) contributions.
It's enough to make someone quit.
When the 15 million unemployed Americans do find jobs again, they'll return to a workplace that is likely to have grown accustomed to less pay for more work, or at least working less hours in a week. The raises that were once part of an annual employee review, if not entirely gone, will take years to get back to where they were before the recession.
Work furloughs, which equate to a pay cut because workers are mandated to take time off without pay, are popular because they save companies money.But that's not the case at state-run hospitals, prisons and other facilities that are open 24 hours a day in California.
A study by UC Berkeley's Center for Labor Research and Education found that mandatory furloughs of three days a month for California government workers reduced state revenue and increased costs. The furloughs didn't save the state money. The workers who took the equivalent loss of seven weeks of pay saved the state 12 cents for every dollar cut in wages, the report found.
Utah started a four-day work week for state employees as a way to save the government money in overtime pay and energy costs, and the good news was that workers didn't have to take pay cuts or work fewer hours. But they did have to learn the difficulty of working four 10-hour days.
Hawaii recently instituted "furlough Fridays" at its 256 public schools to help the state save money. The shortened school week is expected to last for at least the next two years.
Pay cuts so far in 2009 have been the largest in nearly two decades, according to a McClatchy Newspapers story quoting a government index that shows the real average weekly earnings are down 1.9% since its high point in December 2008. The average workweek is 33 hours -- the shortest on modern record.
But it beats being without a job.
"The ones who have jobs are willing to give up a lot to keep them," Tom McCoy, a compensation consultant at Intellithink, told McClatchy. "They've seen the alternative."
That may be what's keeping the American worker -- whether with a job or not -- from storming the castle and demanding something be done about all of this. Fear. Fear of losing a job, no matter how bad it is, because at least it's a paycheck and expensive health care, and that's better than not having it.
Because after you add on pay cuts, forced days off without pay, eliminate retirement benefits and tell someone to do the work of their buddy who was just laid off, and after you've beaten them down by not giving them raises for all the extra work they do, then you're shooting yourself in the foot.
Because if the workplace is changing, then the American worker is too. They may find that after getting beat up during the recession, they no longer like working for a company that treats them bad when times get tough.
A friend and co-worker who quit his job for a buyout more than a year ago as layoffs loomed, recently told me that at his new job he had to take a companywide 5% pay cut, along with a cut in benefits and increased workload. His wife is unemployed and they have a house, so the extras such as dining out weekly are being cut back.
He rides the bus to work, a vacation was canceled and buying new clothes is something they haven't done in a year.
I doubt if he's going to quit his job when the economy returns and he gets his 5% pay cut back, hopefully along with a raise, but I'll bet he'll look at working a lot differently when things do improve.
Taking everything you can away from a worker when the going gets tough not only strains the relationship, but the effect on the economy may last just as long. The car, vacation and clothes that workers didn't buy because they had to work less and were paid less during the recession won't return as quickly.
The recession, whenever it ends, will have changed the workplace permanently.
Aaron Crowe is a freelance journalist in the San Francisco Bay Area who can be reached at www.AaronCrowe.net