Large and small companies don't fire employees at slighest whim of economic problems in the society. Only after their own business is suffering they fire employees, thus the lag?
Up till now I've thought, that this indicator is actually a leading one. Somehow I can clearly see, that the herd's been l(ai)ed today...
Of course its a lagging indicator. A company doesn't want to lay somebody off only to realize the slowdown was a blip and now they have to hire and train somebody new. So they wait to lay people off as long as they can.
Uhm where the hell do you get that from? You need to talk to some people in the corporate world, it's quite the opposite. People fired = savings = bonus for exec.
LOL, training. Morgan Stanley just did this, fired a bunch of people, the execs logged their bonus, then they used the "savings" to re-staff the departments. My first job in the corporate world, the VP who ran the department used to fire ppl at the end of the month just to meet certain numbers and show "savings". Meanwhile, new people were constantly trained because more staff was needed. The first thing CEOs do when the company runs into any trouble is cut costs via firing people. Even if this runs the company into the ground, like with Circuit City. When you make it that "2+2=4" means smaller bonus, the person will argue to the death that "2+2=5"
How does he save money by firing everybody (with severance I bet) and then hiring new people (who have to be trained)?
LOL that's what I said within months of working there It was a she, a crazy skitzo b*tch who can look in ur face smile and be super friendly, then turn around and fire you. She just met certain statistics to qualify her bonus. Every head has a certain cost associated to it, so as long as she kept a certain official head count, she met her numbers. As for covering the true expenses, you have to understand that corporations (and capitalism in general) value technology above all. I'm pretty sure she shuffled the costs into R&D budget. As a sidenote, during that same year, the bank forced an upgrade of the operating system which was not needed at all, because some Microsoft guy sold them on it. It caused lots of problems which disrupted work, added NOTHING beneficial, caused techs to work overtime, etc. etc. etc. The CTO got an added bonus due to a "successful transition". There are millions of stories just like this, the whole offshoring trend alone is worth several volumes. Circuit City is a classic case illustrating the corporate exec & CEO mentality. People and even companies are disposable as long as the CEOs get their compensation.