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Tina Samuels

Tina Samuels writes on topics like Amerisave and small business solutions.

Tina Samuels has written 23 articles for SB Informer.
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Will Constant Layoffs Give My Small Business a Bad Rap?

Tina Samuels

July 23, 2013


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In a difficult economy, everyone is struggling, including businesses.

Being on the employee’s side, it is stressful when you never know how long you can keep your job. But it is also difficult for employers who don’t want to lose their employees, but feel like there is no other choice.

However when you get into the habit of laying off employees on a constant basis, it can have more of an effect than a smaller staff.

You may be giving your business a bad reputation for your clients, customers and future searched for candidates.

Lack of Employment Opportunities

Just because you’re in need of laying people off frequently now, doesn’t mean you always will.

What if your executive or upper management suddenly quits, and you need to fill that role as soon as possible? If you already have a reputation for constant layoffs over a certain period of time, it’s going to be hard to find someone.

You have the reputation of not providing stable employment, regardless of the job, salary and level of employment it is. You will be hard pressed to find a decent candidate by job seekers who are doing their research on your company and find how many issues you have had with retaining employees.

Bottom line, this can really hurt you if you’re struggling to find new candidates in the future.

Poor Business Sense

Unfortunately, when word gets out about your constant layoffs, it may cause a concern for your clients and customers as well.

Your current customers and clients will start to get worried about the stability of your company and whether or not you’re able to handle your workload with such fewer employees. It also negatively affects your reputation when you’re trying to find new business.

Clients can do a quick search on your company, find out about your financial struggles through frequent layoffs, and get the impression you have a poor business sense because of these difficulties. That assumption, whether it’s true or not, can definitely have a negative impact on your reputation.

High Costs Involved

Finally, it is going to cost you a lot of money when you’re laying employees off.

If you think this is a quick fix to more profits, you’re in for a big surprise. It costs money to let employees go with all the paperwork, final paychecks, benefit packages and severance packages paid out to employees who are let go.

Plus the more employees you let go now, the more you will need to hire later on, and this also costs a pretty penny. Try to find a way to keep more employees and avoid these high costs.

How to Avoid Layoffs

If you want to avoid getting a bad reputation, try to avoid frequent layoffs. They aren’t always avoidable, but you may be able to decrease how many are required.

For example, try taking away some perks you currently give your employees, to save money. Things like company cars, company credit cards, newspapers every day, or even bottled water. This will save a good deal of money.

You can also consider keeping your employees but decreasing their weekly or daily hours so you’re paying less.

Lastly, you may also need to cut benefits and leave it up to the employees if they want to stay or go.


                   



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