HR Pros Say Budget Cuts, Hiring Freezes 'Likely' unless Economy Picks Up
A recent poll, "Changes Organizations Have Made in Light of 2008 Financial Challenges to the U.S. Economy," was conducted by the Society for Human Resource Management, showing that 70 percent of HR professionals feel budget cuts across entire organizations are likely if current challenges to the U.S economy continue. More than half (55 percent) of the respondents said hiring freezes are also likely under those same circumstances.
When asked what actions regarding employee investments and retirement planning their organizations are most likely to take in the coming months if there are no reversals in the current downward economic trends, 83 percent said they would consider providing employees with financial educational literature and/or workshops by investment specialists. Another 21 percent said they might revise investment policies for 401(k) plans and other savings programs.
Besides organization-wide budget cuts and hiring freezes, HR professionals said cutting bonuses (50 percent), freezing wage increases (45 percent), and layoffs (39 percent) are "likely" actions that might be taken should economic conditions worsen. However, respondents said restructuring executive compensation and/or severance packages (82 percent), and outsourcing some business functions (79 percent) were only "somewhat" or "not as likely" to be taken under the same circumstances.