Work is super busy, but………..

As headlines bring forth mixed news on the economy and my concerns grow – the company I work for is unbelievably busy. Over the past few months I have been pulled in two different directions as I firmly believe this economy is in serious trouble yet I have seen strong orders  coming in from customers. In case you are wondering – the company I work for supplies a multitude of industries from housing, cardboard, soft drink, to cotton. We are flat out busy and I have found it difficult to understand why if the economy is that bad.

I believe I have found the answer…….

Recently severe cost cutting avenues are being looked at as although the company is making money – margins are WAY down. From what I gather – competition is fierce as industry competitors are all trying to survive. Sales have had to sell products for less, provide more expensive service options as well as other perks to gain business. The company has done well – which is why sales are up so much – but at a great cost.

Companies across America are cutting costs and trying to find ways to be more efficient. This has been going on since 2008. They are in a fight to survive. This is certainly one of the reason unemployment remains high. Employers do not want to add the expense of head-count.

It is a difficult situation especially when you add the multitude of governmental regulations which is truly out of control.

Unfortunately it is not very comforting to know that I and my company are not alone.

Rourke


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4 Comments

  1. Rourke, Sadly there is only so much belt tightening that a company can do to stay a float. When they hit that critical mass then they start to go under. I don’t know how much more some of these companies can do to compete. I hope that you stay on as long as they have jobs.

  2. I’m not sure what business you are in, but working for a busy company and working for a healthy company are two different things. Today’s reality is that a lot of companies are giving away the store for cash flow. While the company is really busy there is no profit, just cash flow.

    Others are really busy because the competition has gone out of business, but again the profits are margins are very thin.

    Then there is the banking profits that we are seeing this week. Yes the profits are up, but its all due to consolidation, downsizing. Its estimated that another 200,000 banking employees will be laid off in the next 12 months.

    So while your company is busy and the banks are profitable. Is it really good for the economy? Is it good for your company or are they giving away the store?

    As a business owner we all need cash flow, but we can’t live on just cash flow for very long, we need profit. If a company doesn’t have profit, its on life support.

  3. I work with a number of small businesses and for the most part, they have kept prices down in order to keep their doors open. This often means that the owners have had to take deep cuts in profits – and in their lifestyle – in order to feed their business engine. Moreover, they have made cuts in their own salaries in order to their employees on the payroll. In addition, professionals that I work with, including myself, have not raised their fees in years.

    This is the reason I feel that payroll tax incentives for employers are not a solution to the jobs problem in this country. Employers – and I don’t blame them – are going to pocket the extra profits rather than invest in new jobs. Or, more likely, they will spend the extra cash to make up for the horrific increases in healthcare insurance for their people.

    This is a no-win situation. I wish I could wave a magic wand and fix it.

    — Gaye

  4. I am the Quality Manager at an Automotive Interior Manufacture (mainly Honda). Our orders are up next month due to the Tsunami and Honda trying to make up some of those losses. After next month……not so good…

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