Walking Wounded: Job Loss in B.C.

Image by: Tim Tebbkin

Last year 55,000 people lost their jobs in B.C. For those employees left behind – the supposed “winners” – 2010 isn’t looking much brighter.

Tony was working for the Vancouver arm of a European-based software development company when the first round of layoffs hit. It was January 2009, and in his office of 1,200 employees 200 were shown the door overnight – but that wasn’t the worst of it. “I was transferred to a new department and then was told that they’re going to close it at some point in the future, and no one knew who would stay and who would go,” says Tony.

Over the next six months, the office rumour mill took its toll on the staff, and morale was decimated. “People sort of stopped working altogether,” says the 36-year-old engineer. “Apparently, due to a union in Europe, management couldn’t share any information with the regular employees. But it meant the working conditions here were awful. Morale was terrible.” Though Tony (not his real name) was one of the lucky ones who stayed on when the department closed, he’s now actively looking for another job.

In the current economic climate, Tony’s situation isn’t unique. He’s one of the walking wounded: those employees left behind as colleagues were given pink slips. In an economy where at least 240,000 jobs disappeared across the country in 2009 – including nearly 55,000 in B.C. – downsizing survivors are made to feel they should be grateful just to hang on to their job, regardless of their new working conditions. They are the supposed “winners.” But working long hours for less pay and with more responsibility takes its toll on staff, and employers are discovering that cutbacks don’t always result in a more efficient, more productive workforce.

We’ve been here before. In 1994 the American Management Association conducted a survey of 700 U.S. companies that had downsized during the last big recession, between 1989 and 1994. While 34 per cent of those surveyed reported an increase in productivity, 30 per cent saw a decline. Employee morale declined in 84 per cent of the surveyed companies, while 30 per cent of them experienced a drop in profits. Another study done in 1994 in Canada by Watson Wyatt Worldwide found that, of the 148 major companies they surveyed, 40 per cent reported that downsizing didn’t result in reduced expenses, and more than 60 per cent didn’t experience higher profits after cutting staff.

At the time, much of the discussion around the negative effects of downsizing focused on “dumbsizing”: cutting too quickly and losing too many quality employees in the process for the sake of keeping up with the competition. But until recently, the concept of the walking wounded wasn’t on researchers’ radar. “In a lot of ways, these guys were invisible,” says Lee Butterfield, program director at the master of arts in counselling psychology program at the Adler School of Professional Psychology in Vancouver. “They weren’t chronically unemployed; they’re not marginalized. It was thought, You have a job; you’re on easy street.”

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