GFC staff cuts were too harsh, say employers

by 26 Aug 2010

Most Australia and New Zealand employers admit the cuts they made to personnel during the GFC were too harsh.

The overwhelming majority (80 per cent) of employers now have an active focus on growth, but their attempts to rebuild and improve the strength of their workforce are falling flat, with 84 per cent stating the redundancies they made in the downturn had left them under resourced to grow.

Simon Moylan, executive general manager at Hudson Talent Management, said: "During the downturn many organisations 'cut the fat' but these results suggest that many also 'cut into the muscle'. Employers desperately need to bolster not only the size, but also the strength of their teams to bring their businesses back to a place where they can compete effectively in their markets and establish a solid foundation for sustainable, long-term growth."

The research findings, part of the Hudson 20:20 Series report Positioning for Growth – Building a Dynamic Workforce in a New Economic Era, reveal that almost two-thirds of employers and employees alike (59 per cent) reported that their teams are under-resourced.

Fifty-four per cent of employees say the team they work in is now weaker.

Overall, 11 per cent of the workforce was lost through voluntary redundancy, enforced redundancy or staff leaving of their own accord and employers say that 23 per cent of workforce losses were high performers. .

The survey also examined Australia/New Zealand employers' current hiring procedures.

Employers said that almost half (44 per cent) of their current hires are 'not good'.

They said they appreciate the importance of robust hiring processes in appointing good hires and their impact to the overall health and performance of their businesses. Over three quarters (79 per cent) also say their hiring process is formalised.

However, almost two-thirds (63 per cent) of employers' current hiring procedures focus on basic techniques such as resume screening and simple interviewing. Only 30 per cent focus on richer methods such as behavioural interviewing and personality testing and more sophisticated methods that look at motivation and career fit are hugely under-utilised, at only 7 per cent.

"There's clearly a disconnection between employers' perception of how robust their hiring procedures are and how effective they are in reality. It’s incredible how many employers apply the 'gut feel' approach to hiring when there are proven systems to find, attract and retain high performers," said Moylan.


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