I think it's highly likely that companies make these announcements in the hope that the problem takes care of itself--that employees will leave for new jobs on their own, assuming they're already on the chopping block, and the company just won't replace them. This satisfies investors two ways: it allows the company to reduce headcount without paying severance packages.
Here’s what I’ve learned my short time on this planet: Humans like to reinvent the wheel. They don’t learn from their mistakes or the successes of their predecessors.
I’m sure everyone reading Bill’s column can share a story of a manager who fits that description.
Media fail to report that not one CEO and few execs of companies laying off take pay cuts, skip bonus payments, or share profits from jumps in share prices when cutbacks announced. Only the working poor suffer. Add perks of companies cars, bodyguards, boob jobs for mistresses, and $700m yachts per Amazon and bosses lives not changed one iota. Capitalism at its worst
Actually, part of their job is to lay off staff when business needs require that strategy. They earn their bonuses for making those critical business decisions that benefit the bottom line and health of the company. Capitalism is the basis for our country and part of our democracy.
The media do, indeed, report bonuses paid. In fact, media reported most recently that SVB top execs received bonuses just before their meltdown.
Yep, it's those tough hearwrenching decisions CEOs stay up night making how to blame working people for the wasteful expenses of staffing than decide where to have the next wild party silicon valley companies are known for. God forbid the govt bail out student loans but banks and billionaires are national emergencies.
As you well know, they are calculated business decisions. Some companies are wasteful and others are not. And sometimes they are heart wrenching decisions. I’ve been forced to make some myself over the years. For me personally it was always a struggle.
You are incorrect regarding the case of the current regional banking situation.
The banks nor their investors are receiving a bailout. The depositors are being made whole which has an impact on many small businesses that would be forced to lay off staff had the government not intervened. Would you prefer the government not take this action?
Your declaratios are partial truths. FDIC is incentivizing other banks to takeover this one according to Federal officals' comments. Making whole the depositors makes the FDIC system of rules and regs worthless especially the public companies with deposits. They didn't make small family business with more than $250k in deposits whole in 2007-2011 when six banks we had deposits in went belly up, one after the other. Threatening the entire American banking system is at risk is bull like we heard when they bailed out GM, Goldman, and others. How about taking back profits from insiders who sold shares in the millions and took bonuses cays before bk and share it with depositors. This stinks of old boy networking
You are convoluting bailouts with takeovers to support you position. Doesn’t work like that. Incentivizing is quite different from a bailout. Moreover, if a “bailout” is temporary and is repaid it’s not a handout but rather, an investment in the system.
Sometimes rules need to be bent when their application is more problematic than common sense given current circumstances. The longer arc will balance the scales.
Second, you are now attempting to obfuscate by bringing up 2010 financial crisis. That was quite different and is not relevant to today. That’s a typical tactic of a politician that doesn’t want to stay on point. But nice try.
You are obviously upset; I can sympathize. If I were in your position I might take a breath and rethink how I was communicating my thoughts.
You're using semantics to denegrate an opposing position. The point is 1. the San Francisco Fed &/or others failed to regulate their "golden boys and girls" in silicon valley; 2. now appoint a "good friend" of the industry to takeover the bank management: the Paulson of 2023. 3. indisers got bonuses and knew when to sell and not one will go to jail for insider trading. 4. small depositors and non-public companies maybe should get covered over $250K ins limit but public companies lost investors' money because most in SV didn't make profits; they lived and partied off investors' money. We shouldn't have to bail them out.
Why is it called pink slip? I was laid off once, and was complete caught off guard. No prior notice or indication. But I didn't receive a pink slip. Instead I got a packet of info from HR on benefits.
There is uncertainty about how the term pink slip originated. A common explanation is that a termination notice was printed on pink paper so that it would stand out from other paperwork the employee received. The term also has unverified links to the early years of the Ford Motor Company.
A Baltimore Sun article in 2001 reported that some believe that Ford’s assembly line workers were issued either a white or pink piece of paper, which management slipped into their lockers at the end of each day. A white slip of paper meant that the employee was wanted at work the next day, a pink slip meant that their services were no longer required.
The first recorded reference of the term in the Oxford English Dictionary was in 1915.
Interestingly, termination notices in Germany are associated with blue, and yellow in France.
Bill, I have to ask, why even make or send out a company-wide speech, letter, or email? What benefit does that provide to anyone? If a company wants to lay off personnel, why not just send emails to affected employees, or even have middle managers meet with the unlucky ones (like the way it used to be)?
That's a good question I hadn't thought through. Maybe the publicly traded ones are going to have to report it anyway, so they calculate it's better to be the source of the news vs someone going through their SEC filings? I would also guess bc unlike in the old days, when 1 or 2 employees get laid off the first thing they'll do is post on LinkedIn, Twitter, etc, and other employees will want to know the big context immediately.
In the days of 24-hour news, Twitter and TikTok, word travels fast. Even a small number of employees posting about their lay off from a big brand company with the right hashtag could incite panic -- are they laying off ALL employees? How many? Is the company going under? Companies know they need to get ahead of the news in an attempt to control the message.
FB, MS and Goog ditching employees matters not. They are all still major spying/data manipulation organizations. It's extremely rare for a person to manage to stay with one company for an entire working career. My sister has somehow done it having only one employer for the last 45 years.
Bill: with all due respect your rumantion about CEOs taking pay cuts "sometimes" is more wishful thinking. I have yet to see one announcing a pay cut when announcing the need for layoffs to save the company; the management apparently hired too many people on the way up and is now dumping them, and their secretaries, and the maintenance janitors; but mismangement in hiring too many people does not warrant firing or pay cuts or sharing their wealth with people making small amounts.
I can’t point to a specific example … at least not while reading this on my phone at the barber shop … Tim Cook took a big pay cut this year … I want to say 40%? But apple hasn’t actually laid anyone off. I was at a venture backed startup for 4 yrs, we did layoffs at one point. I know the ceo was taking zero compensation at the time.
I might look around and see if I can find anything specific on this. But my haircut comes first. :)
“ Yuan explained that Zoom — which he founded in 2011 — had scaled up rapidly to manage the demand of the pandemic, tripling in size within 24 months. But he also acknowledged it didn't spend enough time assessing whether that growth was sustainable or "toward the highest priorities."
Yuan took responsibility for those mistakes and said he would "show accountability" by reducing his salary for the coming fiscal year by 98%, as well as forgoing his 2023 corporate bonus. Members of Zoom's executive leadership team will reduce their base salaries by 20% for the year and forfeit their corporate bonuses too, he added.”
“ New data reveals that most executives (66 percent) have accepted a pay cut in the past six months, with the overwhelming majority of those (94 percent) saying the move was to prevent or reduce layoffs, according to a survey of 1,000 U.S. executives at companies with more than 100 employees from ResumeBuilder, a Seattle-based firm specializing in resume and career advice. Additionally, 67 percent of executives responding to the survey say other executive employees at their company had their salary cut in the past six months.”
Always better to work at a company that is cash flow positive, not burning capital and has a moat around their business to deter successful competitors. When you are too concerned with woke agendas and not focused on your business you end up disappointing your young idealistic workers who were raised in the everybody gets s trophy era
The SVB fallout has also reached affordable housing developers, who for years have relied on loans and sponsorships from Boston Private Bank and Trust, which SVB acquired in 2021, The Boston Globe reported.
“Boston Private has been a backbone of affordable housing development in our region,” Dorchester Bay Economic Development Coalition CEO Kimberly Lyle told the newspaper. “It’s a scary moment for us.”
Meanwhile, members of Massachusetts’ congressional delegation are assigning blame and demanding accountability.
Perhaps as long as it doesn’t take your eye off the main ball of properly running your bank. They didn’t have a credit manager for 7 months- I’ll bet you that they didn’t have a cacancy in DE & I for seven months?
I normally blame lawyers first and HR staff second for the way that layoffs are now conducted. In the 70's my father was laid off several times, each time he was told in advance - usually 2 paychecks in advance, so he had time to plan. In the 2000's I survived 5 waves of downsizing, all kept secret in advance. After all why should a person with over 20 years at the company be entitled to have civlil farewell? That might be a risk to the company so escort them out immediately like a convicted felon and ask the survivors to pack up their belongings.
But it gets worse, when the boss invites everyone, including those laid off, to the department Holiday lunch, and then expounds on a what a good year it has been.
When I was a cog in an industrial setting, our international company decided that since our particular part of the company had blown the doors off of production, they were looking for employees who would like to be “voluntarily” laid off. The company would work with the Employment Security Commission letting them know that the company would put us back on the payroll when inventory got back down to an acceptable level.
Those of us who took part in this semi paid vacay would still be expected to “look” for employment while this layoff lasted. Needless to say there were more than enough of us to volunteer for this opportunity. If memory serves, I was off for about 10 weeks.
I think it's highly likely that companies make these announcements in the hope that the problem takes care of itself--that employees will leave for new jobs on their own, assuming they're already on the chopping block, and the company just won't replace them. This satisfies investors two ways: it allows the company to reduce headcount without paying severance packages.
Here’s what I’ve learned my short time on this planet: Humans like to reinvent the wheel. They don’t learn from their mistakes or the successes of their predecessors.
I’m sure everyone reading Bill’s column can share a story of a manager who fits that description.
Media fail to report that not one CEO and few execs of companies laying off take pay cuts, skip bonus payments, or share profits from jumps in share prices when cutbacks announced. Only the working poor suffer. Add perks of companies cars, bodyguards, boob jobs for mistresses, and $700m yachts per Amazon and bosses lives not changed one iota. Capitalism at its worst
Actually, part of their job is to lay off staff when business needs require that strategy. They earn their bonuses for making those critical business decisions that benefit the bottom line and health of the company. Capitalism is the basis for our country and part of our democracy.
The media do, indeed, report bonuses paid. In fact, media reported most recently that SVB top execs received bonuses just before their meltdown.
Yep, it's those tough hearwrenching decisions CEOs stay up night making how to blame working people for the wasteful expenses of staffing than decide where to have the next wild party silicon valley companies are known for. God forbid the govt bail out student loans but banks and billionaires are national emergencies.
As you well know, they are calculated business decisions. Some companies are wasteful and others are not. And sometimes they are heart wrenching decisions. I’ve been forced to make some myself over the years. For me personally it was always a struggle.
You are incorrect regarding the case of the current regional banking situation.
The banks nor their investors are receiving a bailout. The depositors are being made whole which has an impact on many small businesses that would be forced to lay off staff had the government not intervened. Would you prefer the government not take this action?
Your declaratios are partial truths. FDIC is incentivizing other banks to takeover this one according to Federal officals' comments. Making whole the depositors makes the FDIC system of rules and regs worthless especially the public companies with deposits. They didn't make small family business with more than $250k in deposits whole in 2007-2011 when six banks we had deposits in went belly up, one after the other. Threatening the entire American banking system is at risk is bull like we heard when they bailed out GM, Goldman, and others. How about taking back profits from insiders who sold shares in the millions and took bonuses cays before bk and share it with depositors. This stinks of old boy networking
You are convoluting bailouts with takeovers to support you position. Doesn’t work like that. Incentivizing is quite different from a bailout. Moreover, if a “bailout” is temporary and is repaid it’s not a handout but rather, an investment in the system.
Sometimes rules need to be bent when their application is more problematic than common sense given current circumstances. The longer arc will balance the scales.
Second, you are now attempting to obfuscate by bringing up 2010 financial crisis. That was quite different and is not relevant to today. That’s a typical tactic of a politician that doesn’t want to stay on point. But nice try.
You are obviously upset; I can sympathize. If I were in your position I might take a breath and rethink how I was communicating my thoughts.
… and you might benefit from taking some time out to rethink how you communicate your thoughts: Lecturing is not the same as enlightening.
You're using semantics to denegrate an opposing position. The point is 1. the San Francisco Fed &/or others failed to regulate their "golden boys and girls" in silicon valley; 2. now appoint a "good friend" of the industry to takeover the bank management: the Paulson of 2023. 3. indisers got bonuses and knew when to sell and not one will go to jail for insider trading. 4. small depositors and non-public companies maybe should get covered over $250K ins limit but public companies lost investors' money because most in SV didn't make profits; they lived and partied off investors' money. We shouldn't have to bail them out.
We are bailing out left coast VC and hedge fund guys by increasing the FDIC insurance premiums paid by every bank in the US
That's sometimes true (that CEOs don't take pay cuts etc) and sometimes not. As for the media reporting it or not ... how else would we know?
Why is it called pink slip? I was laid off once, and was complete caught off guard. No prior notice or indication. But I didn't receive a pink slip. Instead I got a packet of info from HR on benefits.
Since you asked::
There is uncertainty about how the term pink slip originated. A common explanation is that a termination notice was printed on pink paper so that it would stand out from other paperwork the employee received. The term also has unverified links to the early years of the Ford Motor Company.
A Baltimore Sun article in 2001 reported that some believe that Ford’s assembly line workers were issued either a white or pink piece of paper, which management slipped into their lockers at the end of each day. A white slip of paper meant that the employee was wanted at work the next day, a pink slip meant that their services were no longer required.
The first recorded reference of the term in the Oxford English Dictionary was in 1915.
Interestingly, termination notices in Germany are associated with blue, and yellow in France.
https://www.investopedia.com/terms/p/pink-slip.asp
Bill, I have to ask, why even make or send out a company-wide speech, letter, or email? What benefit does that provide to anyone? If a company wants to lay off personnel, why not just send emails to affected employees, or even have middle managers meet with the unlucky ones (like the way it used to be)?
That's a good question I hadn't thought through. Maybe the publicly traded ones are going to have to report it anyway, so they calculate it's better to be the source of the news vs someone going through their SEC filings? I would also guess bc unlike in the old days, when 1 or 2 employees get laid off the first thing they'll do is post on LinkedIn, Twitter, etc, and other employees will want to know the big context immediately.
In the days of 24-hour news, Twitter and TikTok, word travels fast. Even a small number of employees posting about their lay off from a big brand company with the right hashtag could incite panic -- are they laying off ALL employees? How many? Is the company going under? Companies know they need to get ahead of the news in an attempt to control the message.
FB, MS and Goog ditching employees matters not. They are all still major spying/data manipulation organizations. It's extremely rare for a person to manage to stay with one company for an entire working career. My sister has somehow done it having only one employer for the last 45 years.
Bill: with all due respect your rumantion about CEOs taking pay cuts "sometimes" is more wishful thinking. I have yet to see one announcing a pay cut when announcing the need for layoffs to save the company; the management apparently hired too many people on the way up and is now dumping them, and their secretaries, and the maintenance janitors; but mismangement in hiring too many people does not warrant firing or pay cuts or sharing their wealth with people making small amounts.
I agree with Bill.
I can’t point to a specific example … at least not while reading this on my phone at the barber shop … Tim Cook took a big pay cut this year … I want to say 40%? But apple hasn’t actually laid anyone off. I was at a venture backed startup for 4 yrs, we did layoffs at one point. I know the ceo was taking zero compensation at the time.
I might look around and see if I can find anything specific on this. But my haircut comes first. :)
“Zoom is the latest tech firm to announce layoffs, and its CEO will take a 98% pay cut“
https://www.npr.org/2023/02/08/1155392099/zoom-layoffs-tech-jobs
“ Yuan explained that Zoom — which he founded in 2011 — had scaled up rapidly to manage the demand of the pandemic, tripling in size within 24 months. But he also acknowledged it didn't spend enough time assessing whether that growth was sustainable or "toward the highest priorities."
Yuan took responsibility for those mistakes and said he would "show accountability" by reducing his salary for the coming fiscal year by 98%, as well as forgoing his 2023 corporate bonus. Members of Zoom's executive leadership team will reduce their base salaries by 20% for the year and forfeit their corporate bonuses too, he added.”
“As Layoffs Sweep Through Tech, Media Companies, These CEOs Are Taking Massive Pay Cuts“
https://www.ibtimes.com/layoffs-sweep-through-tech-media-companies-these-ceos-are-taking-massive-pay-cuts-3671555
“ Twilio Announces Layoffs Ahead Of Q4 Earnings, CEO Takes Pay Cut”
https://www.crn.com/news/cloud/twilio-announces-layoffs-ahead-of-q4-earnings-ceo-takes-pay-cut
“ Looking to Thwart Layoffs, Executives Are Taking Pay Cuts”
https://www.shrm.org/resourcesandtools/hr-topics/compensation/pages/looking-to-thwart-layoffs-executives-are-taking-pay-cuts.aspx
“ New data reveals that most executives (66 percent) have accepted a pay cut in the past six months, with the overwhelming majority of those (94 percent) saying the move was to prevent or reduce layoffs, according to a survey of 1,000 U.S. executives at companies with more than 100 employees from ResumeBuilder, a Seattle-based firm specializing in resume and career advice. Additionally, 67 percent of executives responding to the survey say other executive employees at their company had their salary cut in the past six months.”
Always better to work at a company that is cash flow positive, not burning capital and has a moat around their business to deter successful competitors. When you are too concerned with woke agendas and not focused on your business you end up disappointing your young idealistic workers who were raised in the everybody gets s trophy era
Woke : aware of and actively attentive to important societal facts and issues (especially issues of racial and social justice)
That’s from Merriam-Webster. Seems like having woke as part of your genera would be a good thing from a humanistic perspective.
Meant to say “part of your agenda!”
73 million to Black Lives matter and direct quote in Boston newspaper from a low income community non profit
The SVB fallout has also reached affordable housing developers, who for years have relied on loans and sponsorships from Boston Private Bank and Trust, which SVB acquired in 2021, The Boston Globe reported.
“Boston Private has been a backbone of affordable housing development in our region,” Dorchester Bay Economic Development Coalition CEO Kimberly Lyle told the newspaper. “It’s a scary moment for us.”
Meanwhile, members of Massachusetts’ congressional delegation are assigning blame and demanding accountability.
Perhaps as long as it doesn’t take your eye off the main ball of properly running your bank. They didn’t have a credit manager for 7 months- I’ll bet you that they didn’t have a cacancy in DE & I for seven months?
I normally blame lawyers first and HR staff second for the way that layoffs are now conducted. In the 70's my father was laid off several times, each time he was told in advance - usually 2 paychecks in advance, so he had time to plan. In the 2000's I survived 5 waves of downsizing, all kept secret in advance. After all why should a person with over 20 years at the company be entitled to have civlil farewell? That might be a risk to the company so escort them out immediately like a convicted felon and ask the survivors to pack up their belongings.
But it gets worse, when the boss invites everyone, including those laid off, to the department Holiday lunch, and then expounds on a what a good year it has been.
When I was a cog in an industrial setting, our international company decided that since our particular part of the company had blown the doors off of production, they were looking for employees who would like to be “voluntarily” laid off. The company would work with the Employment Security Commission letting them know that the company would put us back on the payroll when inventory got back down to an acceptable level.
Those of us who took part in this semi paid vacay would still be expected to “look” for employment while this layoff lasted. Needless to say there were more than enough of us to volunteer for this opportunity. If memory serves, I was off for about 10 weeks.
I forgot to say that I did receive unemployment benefits during this layoff.
One other thing, too bad we didn’t turn that hot drone around and fly into the jet intakes. Oopsy!