As the impact of the global economic crisis takes hold, one-fifth of U.S. employers have instituted layoffs and another 26% expect to shed jobs in the next 12 months, according to a survey by global consulting firm Watson Wyatt (see chart below).
“As they respond to the new environment, companies will have to balance how to control costs, maintain employee morale and prepare for future staffing challenges,” says Paul Platten, director of Watson Wyatt’s Human Capital Group.
According to the survey, conducted in mid-October, 30% of employers have already instituted hiring freezes and another 25% plan to do so within the next 12 months.
More than 35% of firms say they will restructure their organizations to cope with tighter cash flows. More than half are putting restrictions on employee travel.
Employers’ response to the financial crisis
Percentage of employers that have already taken the action or plan to in the next 12 months:
Hiring freeze 55%
Raise employee health care premium contributions 46%
Layoffs/reductions in force 45%
Eliminate/reduce seasonal hiring 35%
HR function restructuring 34%
Eliminate or reduce training 28%
Salary freeze 16%
Freeze/close pension plans 15%
Reduce workweek 8%
Salary reductions 7%
Reduce employer 401(k) match 6%
Source: Watson Wyatt survey
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