European companies have not learned the lessons of survival from previous recessions.
One third of companies in Europe plan to lay off full-time employees,
despite reports showing this cost-cutting tactic does not produce long-
A report by The Boston Consulting Group (BCG) and European Asso
ciation for People Management (EAPM), Creating People Advantage in
Times of Crisis: How to Address HR Challenges in the Recession, indi
cates that this strategy, while understandable given short-term pressures,
could have a serious and long-term impact on a company. The report
states that employee commitment is a key element of an effective culture
and how employees are treated in bad times will be remembered by them
in good times.
Because demographic factors mean that Europe’s companies will face
shortages of skilled staff in the near future, the report advised, it is a factor
which business leaders should not ignore.
“Despite the colossal pressures business and HR leaders are under,
they still have choices,” said Philip Krinks, partner and managing director,
BCG London. “They can significantly shape the destiny of their compa
nies. During 2009, as well as responding to the pressures, companies
have opportunities to prepare for when the recovery eventually comes.”