Hardly a day goes by when one does not read of a major national or local corporation laying off hundreds, or thousands, or even tens of thousands of people. Whether for-profit or not-for-profit, the explanation seems always to be the same: To make the organization more efficient (and profitable), the work force must be reduced.
At Union we are trying to do things differently. There have been no layoffs at Union, despite the fact that we have taken some $6 million out of the budget in the past four years-and plan to take another $2.5 million out of the budget next year. The process has not been painless, but it clearly has produced far less pain for the people working at Union. Eliminating vacant positions, asking people to do more, and shifting people from one related work area to another is better than firing people to balance a budget.
Certainly, corporations that are for-profit need to do what they can for their shareholders. Oftentimes therefore, in an effort to reduce costs, employees are given pink slips. The bottom line is increased, shareholder equity is enhanced, and the corporation becomes “lean and mean.” At the same time, communities-and clearly the individuals laid off-face difficult adjustment problems as unemployment swells. The question that might also be posed is whether a “slash and burn” policy really makes a corporation stronger financially in the future or whether the policy will come back to haunt the corporation.
At not-for-profit institutions, too, layoffs are the call of the day. Since we have no shareholders, though, our reason for cutting back has a different emphasis. Although in many cases cutbacks are simply survival, what is the price of survival?
Colleges and universities are labor-intensive. Since we are customer (student) driven, we have to ensure that we do not cut out programs-and people-that are essential to our well-being.
Yes, we could install TV monitors, cut back on faculty, and “reach” more students with fewer people; no, we will not do so. Why? Because our competitive advantage, our strength, is based on an intense and close working relationship between faculty and students.
In an increasingly complex global marketplace, for-profit corporations have to reduce their costs in order to compete; in a financially strapped era, which will continue for the foreseeable future, not-for-profit institutions have also to reduce their costs. However, just as money-making corporations cannot randomly slash their sales force to reduce costs without running the risk of reducing their sales, so, too, colleges must be careful that they do not cut programs (and people) that bring in students and that serve those students in challenging ways.
There is another reason why colleges should think twice before handing out pink slips. Given the fact that we claim that we are a community, we should try to act like one, and, whenever possible, work through things together. Although layoffs may provide the basis for increased compensation for those that remain, they also take something away from the claim to community that we all make.
Obviously, we at Union will also have to change and to continue to reduce costs. The $6 million that has been taken out of the budget during the past four budget cycles has resulted, in part, from a 4.5 percent reduction in the college work force. However, every one
of the reductions came through the elimination of a vacant position that occurred after an individual left the institution or, in the case of visiting faculty, that was not filled again because of a smaller student body.
Will Union be able to maintain a no-layoff policy? The jury is out, but, if those at the College embrace flexibility with respect to work assignments and continue to help identify better ways of doing things at Union, the no-layoff policy will succeed.
It is foolish for an individual running any organization to comment on what someone else should or should not do. Perhaps what many for-profit and
not-for-profit institutions are doing will have to be done everywhere; perhaps the Union experiment of not handing out pink slips cannot work. But one thing is patently clear to me: It is far easier to cut people than to develop imaginative ways of addressing the financial pressures that we all face-and far less beneficial for the institution.
Roger H. Hull
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