On the way to work this morning I was listening to two people on the radio go on and on about the economy and unemployment. Their contention was as soon as the economy starts to grow again companies will begin to rehire employees and unemployment will drop. I was just starting to agree with what they were saying when I noticed the garbage truck in front of me.
It was at that point I begin to realize that the garbage truck epitomizes the economy and the state of modern business. I am not talking about our economy being in the trash nor am I saying that business is going to the landfill. That is an argument that has more political overtones to it than I care to debate. For this discussion let’s focus on the garbage truck.
Do you remember your typical garbage truck picking up trash in your residential neighborhood several years ago? In our community it involved a large garbage truck, one driver and two people riding on the back. The two on the back would jump off and empty the trashcans into the back of the truck. One or ten trashcans it did not matter, they got the job done.
Then the economy went through a small downturn and the garbage companies had to make changes to economize and stay profitable. To do this they restructured their organization and downsized which resulted in one of the two trash handlers on the back of the truck going through an economic layoff. To make this new corporate structure succeed they sent notices to all their customers limiting the number of trashcans that could be placed curbside on trash day to two cans.
As the economy continued to stumble and the garbage companies struggled to make a profit for their investors they had to look at other cost cutting measures. The next major change came with the customers receiving notice that the garbage pickup days were being reduced from 2 days per week down to one day per week but the limit of 2 trashcans per pickup remained.
Then the economy collapsed and the garbage company had to take drastic cost cutting steps to continue operation. They supplied each of their customers with a special standardized garbage can which could be picked up by a special automated garbage truck. Now the only person needed on the truck was the driver. The result was the last of the trash handlers being unemployed.
Now as the economy starts its slow change from a failing economy to one that is beginning to show signs of growth do you think the garbage company is going to rehire the trash handlers they laid off? When the garbage company begins showing strong profits will they increase the days of pickup? They have learned to operate more efficiently, doing the same amount of work using less resources and cost.
This same scenario has played itself out throughout the economy and business. Companies and businesses have had to restructure and redesign their organization and operations in order to survive in the harsh economic times of the past several years. Many, by making hard choices, have not only survived but grown during this time period. They have learned to accomplish the same amount of work and an acceptable level of service utilizing less cost, less resources and less waste (no pun intended).
As the economy begins to grow the vast majority of these companies will not replace the people who were downsized. Their job functions have been automated, absorbed by others in the company or eliminated as non-essential.
Yes there will be new jobs created and some laid-off employees being reinstated as the economy grows and demand exceeds supply. This will happened based on the new improved operating plans and staffing structures.
Efficiency, automation and cost savings are great and some of us will reap the benefits of them. But, as we go forward don’t forget about that trash handler who use to work on the back of the garbage truck.