| Reactive economies? |
The other day while in Costco (for the foreigners, think Bunnings or some other hardware warehouse, but for food), I was graced with this conversation at the checkout, between two Costco employees:
e1: Where the hell is e3?
e2: Oh, we didn't meet our sales target yesterday, so they cut hours today.
e1: So he's not coming in at all?
e2: Nup
Apparently Costco works out their staffing based on a "budget for the day" which takes into account todays sales target, expected customer load, and whatever they have to "make up" from previous missed targets.
While there is nothing wrong with that, it must suck to be an employee in that environment. I can't imagine not knowing how much work I would have day to day. I used to be a casual, but our rosters were fairly static and worked out weeks in advance. I guess that Australia is headed down this path with the new industrial relations laws as well.
That's not why I finally got around to writing this though. It occurred to me this morning that being able to lay off people instantly based on a micro assessment of the economy must also lead to very reactive economies, which are more vulnerable to downturn. If Costco couldn't lay people off instantly, then the billion dollar company would act as a cushion between small variations in economic state and the rest of the economy. Without that cushion, the laid off employee goes home and spends less (being unemployed for a day and all), which has a big knock on effect for the rest of the economy.
I wonder if there are any studies on the probability of this being a problem compared with countries with more employee protection like Ireland? France probably goes too far for such a study, because the barrier to firing there is so high that it acts as a barrier to hiring as well.
posted at: 08:48 | path: /travel/usa | permanent link to this entry
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#2
Chris
Are you a communist or something? why the hell should a business employ someone if they dont have enough business?
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#3
Candice
Hello I have worked for Costco for the past five years. You are right about costco adjusting its hours daily based on previous sales but I would like to clarify what the employees options are. As an employee when you are asked to reduce your hours it is completely voluntary and not mandated. Also if you still want to get paid for that day you can take vacation or sick pay which even employees who have only been there for a year have at least 40 hours of each so they can still get paid for the day but not come in. So Costco is still a great company to work for and while I will admit it is frustrating to be short staffed it is neccessary when the money is not rolling in.