When times are tough and business opportunities are not growing as expected, companies often choose to lay off workers. But poorly thought-out layoffs can lead to the loss of valuable employees. Total HR Management believes a company should consider cutting other business costs before taking the risk of losing experienced employees with proven track records. As a result, here are 5 alternative ways to cut costs in challenging economic periods without laying off employees:
1) Trim spending on training and travel to avoid layoffs
Rather than hiring an expensive training consultant, form employee discussion groups so that your workers can learn about the latest industry updates. In tough times, in-house training options take advantage of and access the talent your company already possesses. Videoconferences and Internet connections make on-site visits to clients and potential clients less essential. Reduce travel expenses by judging the true value of each proposed business trip.
2) Review your telecommuting policies
Providing office space for all your employees is costly and often unnecessary. Telecommuting employees are willing to make sacrifices in exchange for spending less money on gas and other commuting expenses. If it does not need to be done in your office, can it possibly be done from an employee’s home? Can your employees divide their time between working at home and working at the office, switching off to lower expenses?
3) Regularly seek estimates from your suppliers and their competitors
Are you getting the most for your dollar? Your suppliers and their competitors should be finding ways to help your business save money. In a competitive environment, incentives and bargains make sense. In addition, with the Internet providing access to the world, can you expand beyond your local suppliers to find better deals?
4) Freeze hiring to avoid Layoffs
How many companies are laying off workers in one division but also hiring in another? While some new hiring may be needed to adjust to changes in the direction of your business, retraining current employees may be a better and less costly alternative. Make sure you are taking advantage of the assets presented by your permanent employee base to help your company.
5) Avoid Contract Staff and Consultants
Contract staff and consulting firms significantly markup their bills to cover their expenses. This extra cost could be used as compensation paid to your own permanent employees or new employees you hire directly yourself for less. Consultants are far less likely to be loyal to your company than the people you keep on your own payroll. Rather than laying off permanent employees, avoid using consultants and contract staff and paying the extra costs.
Total HR Management understands how challenging it can be to succeed in today’s economic climate. Even in a Presidential election year, the roller-coaster ride seems to be continuing. When your business is getting squeezed, make sure you examine these possible alternatives before you lay off valuable employees. After all, your most valuable resources are your human resources.