Posted on 09/05/2010 11:23:29 AM PDT by SeekAndFind
CEOs who fire people tend to make more money. That's been the trend recently, according to 'CEO Pay and The Great Recession' from the Institute for Policy Studies.
IPS:
The 50 top CEO layoff leaders received $12 million on average in 2009, compared to the S&P 500 average of $8.5 million. Each of the corporations surveyed laid off at least 3,000 workers between November 2008 and April 2010. Seventy-two percent of the firms announced mass layoffs at a time of positive earnings reports.
...
At a time when we should be pulling together to strengthen our shared economic futures, CEOs should not be rewarded for slashing jobs," says IPS Senior Scholar Chuck Collins. "Realigning the interests of CEOs with their employees and the rest of our country would be good for the economy and national morale."
It's disturbing that down-sizing CEOs have earned more recently, but it would be extremely disturbing if the government could control companies behavior in this regard.
So while far from an optimal situation, we're not sure what could be done about it for private companies, without massively infringing on the rights of individuals (business owners).
(Excerpt) Read more at businessinsider.com ...
Who wrote this, Ed Schultz?
http://www.ips-dc.org/pressroom/ceos_who_cut_the_most_jobs_earn_more_than_peers
Highest-Paid “Layoff Leaders”:
* Fred Hassan, Schering-Plough: Hassan received a $33 million golden parachute when his firm merged with Merck in late 2009, while 16,000 workers faced pink slips. Hassan’s total 2009 pay of nearly $50 million could cover the average cost of these workers’ jobless benefits for more than 10 weeks.
* William Weldon, Johnson & Johnson: Weldon took home $25.6 million, more than three times as much as the S&P 500 CEO average, at a time when his firm was slashing 9,000 jobs and facing a massive drug recall scandal.
* Mark Hurd, Hewlett-Packard: While his failure to cover up a relationship with a contractor/erotic film star has been banner news, Hurd’s slashing of 6,400 jobs last year has largely escaped the headlines. After getting the axe himself in August, Hurd added more than $28 million severance to his 2009 pay package of $24.2 million.
http://www.ips-dc.org/pressroom/ceos_who_cut_the_most_jobs_earn_more_than_peers
Highest-Paid “Layoff Leaders”:
* Fred Hassan, Schering-Plough: Hassan received a $33 million golden parachute when his firm merged with Merck in late 2009, while 16,000 workers faced pink slips. Hassan’s total 2009 pay of nearly $50 million could cover the average cost of these workers’ jobless benefits for more than 10 weeks.
* William Weldon, Johnson & Johnson: Weldon took home $25.6 million, more than three times as much as the S&P 500 CEO average, at a time when his firm was slashing 9,000 jobs and facing a massive drug recall scandal.
* Mark Hurd, Hewlett-Packard: While his failure to cover up a relationship with a contractor/erotic film star has been banner news, Hurd’s slashing of 6,400 jobs last year has largely escaped the headlines. After getting the axe himself in August, Hurd added more than $28 million severance to his 2009 pay package of $24.2 million.
That’s been happening since mergers became more common in the 80s.
Work harder and longer for less pay and benefits
Oh, please. No doubt the cutting was done to remove bloat & improve the bottom line - of course they should be incentivized for improving profitability!
True, but is that for a good reason?
Many wages went up artificially as did home prices.
Then we have the main problem of government connected union jobs where they are 300% overpaid and reap benefits you can only dream about by buying a winning lottery ticket.
Getting rid of the deadwood has always been the hallmark of most successful CEO’s. Like it or not it’s historically accurate.
Put them to work at EPA, IRS and Dept. of education.
Visit this web page to see the people and interests of those who staff the IPS.
It is a liberal organization dedicating much of its staff work to what it defines as "inequality" in America.
The ideas which brought America from a wilderness, peopled by persons using the crudest of tools, to a place of opportunity, freedom, and prosperity are not the subject of this organization's studies. Rather, it is concerned with "equality of results" and redistribution, not individual liberty and wealth creation.
RE: That’s been happening since mergers became more common in the 80s.
Most Large investment houes like Goldman, UBS, Credit Suisse, etc. have Mergers and Acquisitions (M&A) divisions advising companies on how to profitably do these.
Of course LAYOFFS are going to be part of the M&A package as divisions, offices, Information Technology departments, etc. become REDUNDANT.
Here’s also another factor to consider -— MOVEMENT OF OPERATIONS AWAY FROM EXPENSIVE CITIES ( e.g. New York City) to LESS EXPENSIVE ONES ( e.g. Colorado Springs, Tampa, etc.).
The company I used to work for asked lots of people to move to Tampa ( from New York City ), paid for their relocation with the proviso that they freeze their NYC level salary for 5 years.
Those who took the offer are still employed. Many of those who remained in NYC eventually got let go as the company found people in Florida who could do the same job more cheaply.
If that’s what your competitors are doing to cut their own costs, you have 3 choices: lead, follow, or get out of the way.
The market rewards efficiency, and cares little about externalities.
too bad the same can’t be done for the federal government
A lot of these jobs can be done less expensively overseas or by H1B workers hired from overseas.
Welcome to reality. If the quarterback of your favorite team can be replaced by a young stud, at least as good, for half the salary, guess what happens. Fair, not fair, it is irrelevant. No one here hires anybody to do work on their house because they pay their employees more.
Way wrong...For the most part, private sector wages have been totally stagnant for 10 years.
Bull shit...Tell that to those left, that haven't been terminated from employment, that are now taking up the slack, who are now working twice as hard, for less money, and little or no benefits.
Ya think the working class hasn't' noticed this punitive trend?
It might as well have been. IPS is an old hard-Left think tank founded by a Bolshevik. Really. Not a Commie wannabe but one of the original kind... and the Institute is well-funded by.... (guess).
Hint: Open Society Institute. Tides Foundation.
I think you figured it out.
Companies aren’t in business to give people jobs!!!
Good owners are lean and mean!
“Tell that to those left, that haven’t been terminated from employment, that are now taking up the slack, who are now working twice as hard, for less money, and little or no benefits.”
If you don’t like it quit!!!!
No one needs anyone with your attitude working for them!
I worked on a manufacturing floor for three/four years. New owners came in, let go half the staff, the work got easier, quality improved. There were so many people, you previously couldn’t get anything thing done and ‘their jobs’ were eating money that eventually went into new( ish ) plant equipment.
There is no such thing. Labor, just like any other input of production, costs as much as a given market determines in a given instant of time.
Condo-flippers --- yes, it was a full-time occupation for some people in 2003-2007 --- were also paid "American" (that is, inflated) salaries. The market subsequently determined that they should be paid less. Milkmen too were once paid "American" salaries until the market changed its mind.
Firing people can be a GOOD thing if you get rid of the deadwood—both for the bottom line and morale. Problem is that is hard to do. You typically get rid of as much muscle as fat.
Firing good people and keeping slugs can have the opposite effect.
(bull)Companies aren’t in business to give people jobs!!!
Good owners are lean and mean! (shit)
In that case a good citizen should not buy their crap!
What is a business for anyway is to provide jobs so we
can buy their crap
No, a business exists to provide a good or service that is in demand for a competitive price. If it can do that while exhibiting measurable sustainable growth it will survive, it not, it will fail and someone who can, will.
Vincent Fernando has worked as an Asia-regional analyst for a top tier investment research firm, and as a investment analyst for a US-based portfolio management company. He currently runs a research consulting business called Real Research LLC and provides research consulting services to a multi-strategy hedge fund.
Institute for policy studies
Turns ideas into action for peace, justice, and the environment: IPS is the nation’s oldest progressive multi-issue think tank.
I propose a $10M bonus for the next Illinois governor who cuts state payrolls by $250M. Sounds like a good deal to me.
I'd rather juggle chain saws than work in today's greedy, "work harder for less", corporate America...Ya might as well bang yourself in the head with a bat daily. lol
If you don’t like it quit!!!!
Hey, that's a good banner to hang out front of your business dale!
Ya, I believe that...:o
Ya know what's next don't you?
Next they'll tell ya, sorry folks, were moving our entire manufacturing to Red China....Sorry, see ya!
And from years past: “Chainsaw” Al Dunlap, “Neutron” Jack Welch, ...
lol....Where do you get this garbage? I got news for ya....They exist to make profits and survive...
One of the hallmarks of a well run company is that when hard times inevitably come, they know who to lay off. Poorly run companies will fire the function and terminate the employee performing that function even though he may be an exceptional employee stuck in an unnecessary functional position.Well run companies know who their good people are all the way down the line and will lay off the true dead wood and reassign the good employees to vital functional positions that the deadwood had occupied.When the recession ends they are in a stronger position to move forward.
Much of my family has worked at Boeing since the 60’s. You could fire 60 to 80% and not notice. Their words. My Mother was an exacutive secretary and she did 3 peoples jobs and was always looking for more work.
I worked at Fed Ex for 11 years and we could have dumped 50% and got the job done no problem. Corporations have become like big government. The bigger they are the easier it is to hide waste. Much of that waste is employees.
Tens of millions have been laid off, fired, downsized and eliminated.....
The only places where there are too many employees, or excess "fat", are in government and maybe some union companies..Outside of that, most all companies have slashed to the bone just to survive....
This is not news or a sudden new trend.
For the most part, those left in the work place won't be getting raises, their benefits will be eliminated and slashed, and they'll be expect to work much harder and longer for less...While the corporate drones sit around all day concocting meaningless incentive schemes and stupid prize give aways in lieu of deserved raises....
Today's work place is a basically a meat grinder where the people are expected to produce more for less wages.....All while most everything except wages, goes up and up in price.
They are screwed!
Nitro Golf Balls, Stuart Fl. We got so efficient that Titlist tried to sue us for two skews at Wal-Mart. They folded their suit and cut a ten million plus check.
Anyway dumbkoph, here’s the reality. Do it cheaper, faster, better at less cost every year, or die. That’s manufacturing.
In manufacturing, on the floor, get rid of all people, if possible. Machines don’t make mistakes, work for years if not decades with minimal maintenance, especially( not that you would know ) with ladder logic automation software, sensors and relay replacing industrial PLC computers you can dial in any quality you want. One defect on one part is too much. Most part manufacturing is moving to no defects per...pick your number. This is why the rolling assembly of thousands of flawless parts in your car can commonly go 250 thousand miles as apposed to the old master, hands on lath operator days where cars crapped out at well under a 100k.
Outside the floor, flatten your back office. Less is more, improves communication and speeds decision making and information flow.( That means paper pushers, Dilberts of the world gotta go )
BTW, still, more than 3/4 of all golf balls sold, world wide are made where? US. Why? Automation.
Better go back to remedial reading, I think that’s what I said.
I got news for ya....They exist to make profits and survive...
Better go back to remedial reading, I think that’s what I said.
You think wrong slick.
The word "profit" does not even appear in your comment, Mr. reading, comprehension expert.
I like you and don't mean to come off as a mean jackass.... Did I fail?
*We* can't bitch too much...Ya see, we were told all about the all controlling types.....With government, they're a damn magnet to metal..."We have the authority, fu and STFU."
Not the neighborhood I was raised in............................ How about you friend?
“The word “profit” does not even appear in your comment...”
No it doesn’t but thisw statement which you conveniently left out of your rebuttal does:
“If it can do that while exhibiting measurable sustainable growth it will survive, it not, it will fail and someone who can, will.”
It’s academic that “profit” MUST exist for “measurable” “sustainable” growth to occur.
I assumed that most here already understood that.
No, a business exists to provide a good or service that is in demand for a competitive price.
Businesses do not not exist for the reason you stated above. Once again ....They exist to make profits....
Feel free to deny what you've already stated.....lol
I give up. You treat obtuseness as if it were a virtue.
I can hear the faint sounds of “The Internationale” playing in the background as I read this thread.
Wrong, they exist to make profits
If it can do that while exhibiting measurable sustainable growth it will survive, it not, it will fail and someone who can, will.
Business expansion/growth and existing in business to make a profit are two complete different things.
To make my point so even you can understand, I personally know successful businesses that have been in business for 40 years, and remain the same size and never expanded. In fact, one of those businesses reduced their market targets and reduced their production.
Business exist for profits. Growth and expansion are completely optional.
I agree, yet we expect economic growth in the broader economy to be a constant. This probably isn't a reasonable expectation.
You are *seriously* detached from reality.
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