For nearly all firms, training a worker for the tasks they were hired to perform, once hired, is a mixture of uncoordinated efforts. Read More

It seems counter-intuitive, but there are some who even recently promoted a business strategy that encouraged employee turnover. In a July 21, 2015 Forbes article entitled “Rethinking Employee Turnover,” author Edward E. Lawler III, “Indeed, the turnover of some employees may end up saving an organization more money than it would cost to replace that employee. The obvious point is that not all turnover should be avoided—some should be sought.” The question is how to determine which ones to keep and which to encourage to leave. Without accurate measures of costs and values of a worker, good employees may be pushed out along with the “bad” and then the true costs of this action realized by the employer after it is too late.

Last year, Christina Merhar of ZaneBenefits wrote in her blog entitled “Employee Retention – The Real Cost of Losing an Employee,” “Happy employees help businesses thrive. Frequent voluntary turnover has a negative impact on employee morale, productivity, and company revenue. Recruiting and training a new employee requires staff time and money. According to the Bureau of Labor Statistics, turnover is highest in industries such as trade and utilities, construction, retail, customer service, hospitality, and service.”

“Studies on the cost of employee turnover are all over the board. Some studies (such as SHRM) predict that every time a business replaces a salaried employee, it costs 6 to 9 months’ salary on average. For a manager making $40,000 a year, that’s $20,000 to $30,000 in recruiting and training expenses. Read More

Another outcome of a lean effort may not include moving personnel, but either equipment or processes out of the Leaned department into another department up or downstream, often without structured training to absorb the new activities and maintain efficiency. Here the loss of gains made are similar if no training on how to perform the processes or run the equipment is provided. Read More

In the Part 1 of this article, I reminisced about the better times for workers several decades ago from my own experience as a young man entering the labor force via manufacturing. If you ask others who were around then, or did a little research, you must have found it was not a fantasy, but the life of a normal American middle-class worker.

Before many employers, especially those listed on Wall Street Exchanges, began to follow neoliberal economics, companies like Hewlett-Packard, IBM, General Electric, as well as their suppliers, were the “gold standard” of employers. Although the steel industry started moving off-shore in the 1970’s, the movement of jobs and decimation of communities seemed to be an isolated occurrence.

The PATCO Air Traffic Controller Strike of 1981 ushered in an unrelenting pattern of legal rulings and legislation that eroded the strength of the labor movement, removing a potent alternative to unprincipled employers. Corporations were emboldened by an infamous 1970 New York Times magazine article in which the Chicago school economist Milton Friedman argued that “businesses’ sole purpose is to generate profit for shareholders. Moreover, he maintained, companies that did adopt “responsible” attitudes would be faced with more binding constraints than companies that did not, rendering them less competitive.”

Supported by right-wing groups such as the American Legislative Exchange Council(ALEC), the Heritage Foundation, The Koch Brothers and the US Chamber of Commerce, a number of states became “right to work” states passing laws prohibiting, or making it very difficult, for labor to organize. Today, 27 states are right to work states, encouraging employers to move their operations there to take advantage of the “pro-business” environment.

According to USA Facts, labor unions declined in strength to 14.3 million, or 10.8%, of US employees in private employment in 2020 – over half of the 20.1% in 1983, when there were 17.7 million employed waged and salaried workers in unions. The number of unionized employees in public sector unions remained relatively constant, at around 35%. Currently there are movements afoot to unionize more of both public and private sector employment, but there are many decades of anti-labor laws in place to overcome. Read More

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