We all know that this economy really stinks (sorry John McCain, but the fundamentals are not strong). As expected, layoffs are accelerating, with Sun, Fidelity, Citi and thousands of other companies shrinking their staffs. In a booming economy, the people getting let go are often the ones with less value to add. Marginal performers, no matter how people try to spin it, are the first to go in any group. Watch the next 10 days — a lot of layoffs are going to happen before Thanksgiving. Then watch the first 2 weeks of December as more companies take headcount off the books.
When the economy falls off a cliff the cuts go deeper. Goldman Sachs is projecting unemployment at 8.5% by the end of next year – and that number under-reports the real level of unemployment because a lot of people stop looking for work and don’t get counted.
Now you’re into muscle and bone – and even great talent starts finding themselves out of work. Further, there are fewer great jobs for them to transition into. Sure, really great people can almost always find a job. But it might not be the kind of interesting, game-changing work that they had been doing previously. Think about it — a whole lot more people will lose their jobs this year, and more still again in 2009. So many of them will get frustrated in their searches and be looking for anything to keep them in the game.
This is when the creative ones start companies, or join others who are getting a new idea going. If you can live without steady income for a few quarters while you build out your new thing – perhaps contracting (good luck finding projects) and doing the start-up in the evenings and on weekends – you might find that you both enjoy it more and potentially have a big payoff when the market recovers.
If you happen to be in a company that’s still growing and looking for people – raise your standards. You no longer have to settle for someone else’s second best. This is the time to build truly great teams. In some cases you can even use the talent displacement to “upgrade” your team by letting go of the bottom tier of your company and hiring in the great ones looking for work. It may sound harsh, but if you’re running a business, division or department, you have an obligation to make your team as strong as possible. It’s getting a lot easier to make that change now and the window won’t last forever.
So, what can you do? Get behind the wheel and drive if you have the the personality. But fasten your seatbelts – it’s going to be a bumpy ride.