3 ms·
In theory it would be better to cut everyone's pay than to lay off some people. But this brings lots of complications. https://www.econlib.org/archives/2013/0
by Symmetry 8y ago
In theory it would be better to cut everyone's pay than to lay off some people. But this brings lots of complications.
https://www.econlib.org/archives/2013/09/why_dont_wages.html https://www.econlib.org/archives/2013/09/why_dont_wages.html
- jmvoodoo 8y agoA lot of these morale problems happen after layoffs as well. If the layoffs are deep enough it makes sense to move the entire company to a different city and completely reboot. In those situations I've seen as much as 90% of the company churn in the course of the year. Once the dust settles it's basically a new company and can feel like a high growth startup.
- jjeaff 8y agoWould be interesting to take a vote from the employees. Would they rather take a collective paycut or have x% chance of getting laid off?
- gdy 8y agoAnd the best employees, who can find a new job even during recession, will leave.
- aaron_m04 8y agoThere's more to a job than pay rate. If the best employees leave because of a recession-time temporary pay cut, maybe the company culture was rotten and the company deserves to go down!