by Nikolas Nies

Created on: March 31, 2009

Employee - Asset or Liablilty?

All the talk; all of our resources are being concentrated on bailing out the economy. We seem to think that we can just throw money at the problem and everything will be fixed. If we keep giving money to the banks, to the automotive industry, and any other failing companies, what are we buying? We can hold them up, but where is there revenue coming from that will gurantee their viability? Until the bust it was coming from you and me. What happened? I cannot speak for you, but I know what happened to me, I became a liability to my boss.

In the '90s, reports were released, asserting that American productivity was at an all time high, growth abounded! The big shots of companies had been successful, they had achieved there goals. Now what? All this money to be had, but what do we do now? They had to justify their existence, "keep our stockholders happy". The new catch-phrase was cost-reduction. They started negotiating (squeezing) with suppliers for lower costs, trimming work-forces, and pressuring politicians for easier paths (NAFTA) to foreign cheaper labor. The latter put heavy pressure on unions, and individual laborers to settle for less money just to keep working. Then China enter the game, and everyone jumped on board. Now, there isn't a manufacturing worker out there who hasn't been effected by the lopsided competitiveness of these free trade agreements. Big business was successful again, at the start of the 21st century, companies were recording record profits. Then came the bust, consumers who had been recklessly spending, felt the pain of lower income, higher credit card balances, and gas prices. Once the bust became reality, the slide began.

The powers that be, keep thinking that we can fix this problem. We can bailout of the mess. Companies need to cut to become viable again. But the problem comes back to you and me, we drive the economy. The government can hold it up, but it is temporary. As long as my boss sees me as a liability, he is going to search for a way to get me off his balance sheet. Employees are not liabilities, they are assets, in more ways than we think. Who buys the cars that GM makes? Those "greedy" employees that work for them buy their cars. You cut their pay in half, and expect car sales to continue to grow? Their suppliers; employees have to take cuts, so that they can sell parts to GM for less, they were buying those cars too. Who borrows money from the bank, buying these cars, buying houses, with the ability to pay it back? All of those consumers that were making a decent living, that were driving the economy.

The only way out of this mess, is not to concentrate on the top. We must concentrate on the consumer. How do we make them healthy again? President Reagan had a trickle down economic philosophy; now we need a trickle up philosophy. We have to deal with the WTO, and encourage businesses to share the wealth with their employees, CEOs cannot continue to collect the wealth at the top and expect things to change. Employees should be considered assets, and every effort should be considered to retain those qualified employees that drive the economy.

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