Current events and their societal impact

Current Event

Lay offs in the government

The United States of America is currently facing economic problems of a severity not witnessed since the 19239-1933 Great Depression. The crisis emerged from within the real estate industry and soon expanded to the rest of the industries and sectors. A direct consequence within the private business community was that of massive downsizing process. Through these, employees were fired in an attempt to reduce organizational costs. The problems with downsizing are tremendous, to include, among others, the following:

The reduced employee morale and confidence in the employer

The subsequently reduced employee performances

Higher levels of employee turnover rates as a result of on the job dissatisfactions, and the adjacent higher costs with staff replacement

The deepening of the socio-economic problem of unemployment and the creation of additional strains on the state budgets, which are now required to fund more unemployed.

In light of the downsizing decisions of the private companies, which created the socio-economic problems, the government stated that it would not restructure its apparatus, but that it would strive to preserve the positions of all its staff members. Less than a month ago however, New York Governor David A. Paterson stated that he would be letting some of his staff members go. The decision was reached in an effort to close a persisting budgetary gap.

Similar decisions were implemented across the globe and in some regions even sooner and at economically damaging costs. Greece has for instance accepted to implement a drastic austerity program in order to gain the support of the International Monetary Fund (O'Grady, 2010). Cuba has also recently announced its intention to lay off public workers in an effort to radically restructure its public apparatus (Malkin, 2010).

In terms of the lay offs announced in the public sector in New York, their numbers were not declared. The lack of certainty and the scarcity of actual figures are attributed to an uncertainty within the public sector, which needs to conduct thorough audits and identify its restricting necessities, as well as specific approach it would implement in terms of downsizing, downscoping or expected restructuring outcomes.

The announcement made by Governor Paterson revealed a federal desire for downsizing, rather the downscoping. The latter concept, understood as a reduction in the operations and diversity of the organizational activities, is not on the agenda of the governor. Paterson also discussed his desire to conduct the restructuring process with the collaboration of the unions, but he was discomforted by the resistance of the unions.

From his standpoint, the union leaders are too stubborn and selfish to understand that the American country, society and economy face a greater danger. Up until this point, the union leaders have stopped Paterson's from creating $250 million savings to the state budget from retirements and lay offs. He even argued the necessity for early retirements, but the people did not answer to this request either. As a parenthesis, this encouragement for early retirement is highly unconstructive in the context of an aging population, the retirement of the baby boomers and the subsequent financial pressures these pose on the federal pension budget.

Nevertheless, Governor Paterson believes that restructuring through downsizing is the single most useful means of creating economic stability. "Mr. Paterson has said he is not trying to coerce workers into grantinc concessions. "I would like everyone in the public to get the message that our economy is in peril," Mr. Paterson said in June, "that our state ran out of money in December for the first time in history." (Roberts, 2010).