ACCOUNTABLE HR
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A labour surplus occurs when labour supply exceeds demand of labour within a specific entity and can be characterized by both quantity and quality dimensions. Quality refers to the skills and work-related characteristics that an employee brings to the organization. Quantity refers to the number of employees and placement throughout the organization.
An organization can handle or absorb this disequilibrium for some time, but if an organization has more employees than needed, issues of inflated labour costs, employee loafing, employee motivation problems, perceptions of equity among productive versus non-productive employees and possibly declining profit margins due to the inflated labour costs may negatively impact the organization. Thus, organizations with a labour surplus usually take action to align the quantity and quality of their workforce supply with the projected workforce demand in an effort to secure continuous success of the organization.
There are multiple alternatives available to an organization to manage a labour surplus including immediate headcount reduction strategies, attrition strategies and work-term change strategies. Post-downsizing, companies that executed layoffs indicated that they are now understaffed, report difficulties meeting deadlines, experience little or no increase in productivity and more than half of the companies saw no improvements to profit.
At ACCOUNTABLE HR, we specialize in the area of downsizing in Canada, in an effort to help your organization overcome the initial labour surplus while staying focused on the short and long term sustainability of your organization post-downsizing. We can help your team identify appropriate strategies for managing downsizing efforts, develop criteria and timelines for the activity, and take actions to manage the survivors of the downsizing activity to ensure a speedy and focused recovery for your organization through:
- Identification of downsizing need, including the desired quantity and quality of resources required
- Development of appropriate and legally defensible decision criteria for selection of employee exits
- Management training in communication, including support during the termination meeting
- Assistance with recovery post layoff including job redesign, motivation of survivors and development of procedures to minimize the risk of a labour surplus in the future