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The Great Global Recession Has Claimed Many Victims in Many

The global recession has led to high unemployment and pay cuts in many countries. More people are in temporary or contingent jobs with few benefits. In the US, statistics show a rise in temporary workers without health insurance or other benefits. Many formerly stable jobs are now temporary. Forecasts suggest poor working conditions and low job security will continue for years. Some argue companies cut costs like benefits and job security to maintain profits, while others say flexible labor is needed globally.

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Amit Pandey
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59 views2 pages

The Great Global Recession Has Claimed Many Victims in Many

The global recession has led to high unemployment and pay cuts in many countries. More people are in temporary or contingent jobs with few benefits. In the US, statistics show a rise in temporary workers without health insurance or other benefits. Many formerly stable jobs are now temporary. Forecasts suggest poor working conditions and low job security will continue for years. Some argue companies cut costs like benefits and job security to maintain profits, while others say flexible labor is needed globally.

Uploaded by

Amit Pandey
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PDF, TXT or read online on Scribd
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Solved: The great global recession has claimed many

victims In many

The great global recession has claimed many victims. In many countries, unemployment is at
near-historic highs, and even those who have managed to keep their jobs have often been
asked to accept reduced work hours or pay cuts. Another consequence of the current business
and economic environment is an increase in the number of individuals employed on a temporary
or contingent basis. The statistics on U.S. temporary workers are grim. Many, like single mother
Tammy Smith, have no health insurance, no retirement benefits, no vacation, no severance,
and no access to unemployment insurance. Increases in layoffs mean that many jobs formerly
considered safe have become “temporary” in the sense that they could disappear at any time
with little warning. Forecasts suggest that the next 5 to 10 years will be similar, with small pay
increases, worse working conditions, and low levels of job security. As Peter Cappelli of the
University of Pennsylvania’s Wharton School notes, “Employers are trying to get rid of all fixed
costs. First they did it with employment benefits. Now they’re doing it with the jobs themselves.
Everything is variable.” We might suppose these corporate actions are largely taking place in
an era of diminishing profitability. However, data from the financial sector is not consistent with
this explanation. Among Fortune 500 companies, 2009 saw the second-largest jump in
corporate earnings in the list’s 56-year history. Moreover, many of these gains do not appear to
be the result of increases in revenue. Rather, they reflect dramatic decreases in labor costs.
One equity market researcher noted, “The largest part of the gain came from lower payrolls
rather than the sluggish rise in sales . . .” Wages also rose only slightly during this period of
rapidly increasing corporate profitability. Some observers suggest the very nature of corporate
profit monitoring is to blame for the discrepancy between corporate profitability and outcomes
for workers. Some have noted that teachers whose evaluations are based on standardized test
scores tend to “teach to the test,” to the detriment of other areas of learning. In the same way,
when a company is judged primarily by the single metric of a stock price, executives naturally try
their best to increase this number, possibly to the detriment of other concerns like employee
well-being or corporate culture. On the other hand, others defend corporate actions that
increase the degree to which they can treat labor flexibly, noting that in an increasingly
competitive global marketplace, it might be necessary to sacrifice some jobs to save the
organization as a whole. The issues of how executives make decisions about workforce
allocation, how job security and corporate loyalty influence employee behavior, and how
emotional reactions come to surround these issues are all core components of organizational
behavior research.

Questions
1. To what extent can individual business decisions (as opposed to economic forces) explain
deterioration in working conditions for many workers?
2. Do business organizations have a responsibility to ensure that employees have secure jobs it
h good working conditions, or is their primary responsibility to shareholders?
3. What alternative measures of organizational performance, besides share prices, do you think
might change the focus of business leaders?
4. What do you think the likely impact of the growth of temporary employment relationships will

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be for employee attitudes and behaviors? How would you develop a measurement system to
evaluate the impact of corporate downsizing and temporary job assignments on employees?

ANSWER
https://solvedquest.com/the-great-global-recession-has-claimed-many-victims-in-many/

Reach out to [email protected] for enquiry.


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