Shhh... we're letting workers go
It's a wild new world of management with a president-elect who's quick on the Twitter finger
Jan 4, 2017
In tough times, companies will always resort to layoffs — but perhaps they will no longer want to talk about it.
By Todd Humber
Is the era of announcing massive job cuts coming to an end?
Note that I wrote “announcing” — and not actually an end to the cuts themselves. Companies in tough times will still hack and slash their way to profitability, and even healthy firms will look to continually trim and find more productive and efficient ways to do the job.
In previous years, announcing 10,000 job cuts might make for a bad headline or two — and dampen morale — but such pressers always played well on Bay Street and Wall Street. Slashing staff must mean increased profits, right? So up goes the stock price.
But something is changing, and his name is Trump.
The president-elect of the United States is notoriously quick on his Twitter finger, and a disparaging tweet from him not only creates bad headlines but can send a stock price into the toilet.
A couple recent examples:
General Motors — On Jan. 3, Trump wrote: “General Motors is sending Mexican made model of Chevy Cruze to U.S. car-dealers-tax free across border. Make in U.S.A. or pay big border tax!”
GM’s stock tanked about one per cent after the Tweet, which was misleading at best. Most of the Cruzes the automaker builds are made in Ohio.
Boeing — On Dec. 6, Trump wrote: “Boeing is building a brand new 747 Air Force One for future presidents, but costs are out of control, more than $4 billion. Cancel order!”
Boeing lost $1 billion in stock value after that missive, despite the fact it’s not clear where he got the $4 billion price tag.
This week, Ford reaped the benefits of Trump’s spotlight after it cancelled plans to invest $1.6 billion US in a Mexican plant and instead spend $700 million to create more jobs in Michigan. Mark Fields, the CEO of Ford, gave the president-elect a pat on the back in making the announcement: “This is a vote of confidence for president-elect Trump and some of the policies he may be pursuing,” he said.
In the Detroit Free Press, writers Greg Gardiner and Todd Spangler may have summed what’s happening up best.
“(Ford) said the decision was made for purely business reasons, but it also showcased the wild new world of management. Instead of militant unions, crusading consumer advocates or relentless environment activists, corporate leaders find themselves trying to anticipate the 140-character tweets of the soon-to-be leader of the free world.”
Trump hasn’t taken on job cuts directly — yet. Instead, he has focused his ire on companies that are moving jobs out of the United States or manufacturing goods across the border. But it’s not a stretch to think a mass downsizing by a profitable company could catch his eye and make for a blistering populist Tweet.
Not only are Trump’s 18.6 million Twitter followers paying attention, but the global media also hangs on every character he types.
While job cuts will always make headlines – in the business media and on Main Street – it wouldn’t be surprising to see corporations downplay such announcements. PR and corporate communications staff might be tempted to recommend “burying the lead” on cuts lest they find themselves under the unpredictable glare of the so-called most powerful person in the world.
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Todd Humber is the publisher and editor-in-chief of Canadian HR Reporter, the national journal of human resource management. Follow him on Twitter @ToddHumber