by Greg Bright

Several big funds management firms, super funds and other service providers – probably more than we know – have instituted what we have all been expecting. They have made some senior, and a lot more junior, people redundant or moved them into part-time roles.

Forget what the Government is trying to do, to its credit, this is what life is really like at the coal face. People are being let go, put on part-time roles and/or being made to use up holiday leave entitlements. Here’s the top-line list of companies where staff have been impacted: AMP, Perpetual, MLC, Pendal, PowerWrap, UBS, Mercer and each of the big banks: Westpac, NAB, ANZ, Commonwealth. The most susceptible Australian companies are listed and with lots of administration staff with extensive international operations. And there are lots of other smaller companies feeling the pinch. And, also, lots of big companies in other industries, such as the media. It’s ugly.

This does seem a bit short-sighted by the management of those companies. According to Sally Humphris, a recruitment executive at Super Recruiters, the cost of getting a senior person into a major role is such that “six-seven-or-eight” months’ salary makes a big difference to the company’s bottom line. “In the investment world, such as ours, it’s all about talent. We need to nurture people and make sure they have good work environments,” she said.

We have actually been through this before, in 2008. Our parents went through it, big time, in the 1930s. It was different then, both in the 1930s and 2008, of course, but it was less certain. This time we know it will be over in a few months, or a year, or so. And then we have to pay for it. It’s ugly.