Article from The Sunday Times, November 16 2008
The Sunday Times November 16 2008
YOUR PERSONAL ADVISER: CAREER
Retrenched ... and what to do next
'In a financial crisis, any paying job is a good one, even if you have to stand in the sun and rain,' an ex- storekeeper tells Mavis Toh and Shuli Sudderuddin
When Mr Chai Choo Sah was retrenched from his job as a yacht storekeeper a month ago, he was not surprised.
For months, business at the company he worked for had been poor, as rich overseas clients - perhaps victims of the current financial turmoil - dropped off.
Some 50 colleagues had already been laid off earlier.
With help from the National Trades Union Congress (NTUC), the 57-year-old father of three children in their 20s, whose wife is a homemaker, got a job as a landscaping technician in about two weeks.
The union arranged interviews for him at his old workplace as soon as he was retrenched. He had to take a 40 per cent pay cut from the $2,000 he was getting before.
'In a financial crisis, any paying job is a good one, even if you have to stand in the sun and rain,' said Mr Chai.
The Singapore National Employers Federation said 6,100 workers have been retrenched up to September this year, compared with 7,700 for the whole of last year.
The 1997-98 Asian financial crisis saw 29,000 jobs axed. The Sept 11 aftermath in 2001 saw 25,000 people laid off.
Labour chief and Minister in the Prime Minister's Office Lim Swee Say has predicted the possibility of a retrenchment level this year of 'around 10,000 or less, and an overall unemployment rate of below 3 per cent'.
Experts whom The Sunday Times spoke to said that besides the financial sector, electronics, manufacturing, hotels and retail have been badly hit by the turmoil.
Said Ms Julia Smith, country leader for Hewitt Singapore, of a recent survey: 'The most common response to the recession is a hiring freeze, but 15 per cent of organisations surveyed said they will likely have retrenchments while an additional 35 per cent are considering layoffs.'
The Singapore Human Resources Institute also carried out a recent salary survey. It showed that, on average, three supervisors, eight executives and 19 non-executives may be retrenched per company.
Last week, DBS announced 900 job cuts, and 750 staff have already been laid off by IM Flash Technologies, a joint venture between Intel and Micron Technology. Motorola and American Express have also told local staff that job losses loom as part of global cuts.
This means business is picking up for outplacement specialist Paul Heng, founder of NeXT Career Consulting Group.
'Inquiries have doubled over the last three weeks,' said Mr Heng, who works with firms to provide support for retrenched workers. 'First quarter next year, there will be more bloodshed.'
Mr Heng's team has been present at many retrenchment exercises to help those affected manage their emotions and plan their next career moves.
'Some get angry and upset with the company, some break down and cry, and others put up a brave front,' Mr Heng said. 'The impact of a retrenchment is usually difficult to stomach.'
Some observers said the 'R' word can come back to haunt employers.
Mr Renny Yeo, president of the Singapore Manufacturers Federation, said: 'Retrenchment is an expensive long-term exercise because once the economy picks up again, the company will have lost relevant skill sets.'
Mr Heng agreed, adding that retrenchment should be a 'last resort' and companies should first look at other ways of reducing costs, like cutting down on overtime and going for short work weeks.
The Dairy Farm group has never retrenched full-time staff since it emerged, in 1903, as supermarket Cold Storage.
The group - which includes other businesses such as Guardian, Giant and 7-Eleven - now has 7,000 employees in full-time and part-time positions.
'We have kept our workforce trim and multi-tasking at all times. Supporting this strategy is the use of part-timers during peak hours and weekends.
'With this approach, in the event of a downturn, we can easily release part-timers if there is a need. However, at the moment, we are still short of workers,' said Ms Carol Yong, human resource director for Dairy Farm Singapore.
Stockbroking firm Phillip Securities also swears by its staff. It has seen a 75 per cent drop in transaction volume in recent months, but it has yet to retrench any of its employees and has no plans to do so.
'In our 33-year history, we've gone through many cycles of recession and we've never had to resort to retrenchment,' said managing director Loh Hoon Sun. 'People are our key asset and this is good for staff morale.'
To counter the recession, the company - with 3,000 employees globally - has cut down on advertisements and frozen headcount. It may have to trim year-end bonuses.
But where job cuts cannot be avoided, NTUC deputy secretary-general Heng Chee How urged retrenched workers to be prepared to switch industries.
The union and the Workforce Development Agency provide training and courses for skills upgrading at subsidised rates.
'It's not easy to switch industries but it may be necessary,' said Mr Heng.
Mr Chai, the ex-storekeeper, said: 'Just look for another job as fast as possible and don't wait or waste time. We must do what it takes to survive.'
Are you worried about retrenchment? Have your say at straitstimes.com
Paul Heng, Founder
NeXT Career Consulting Group, Asia