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Tuesday, April 8, 2014

Who Took the Human Out of Human Resources?

My undergraduate degree is in Industrial & Labor Relations.  My first few jobs in my career were as an HR consultant, a labor relations specialist and then an HR generalist.

This was back in the early 90s when "In Search of Excellence" was the latest and greatest business philosophy.  The term Personnel was being replaced by Human Resources because the workers were the greatest resource a company had.

So here we are 25 years later.

What the heck happened?

Human Resources has been retitled Human Capital at some firms.

Capital.  As in the number of widgets in the warehouse.

With the onset of computerization, people became ID numbers that could easily be manipulated into reports with projections on performance.

And then profit.

I used to manipulate much of that data.

But there were always people behind the numbers to me.

In 1995, prior to leaving the field, I remember setting up a resource center for employees who were being laid off.  The middle aged engineers laughed at the idea that they would ever be able to find work again.  The newer, younger, cheaper graduates were lining up and were, in many cases, more qualified.

I basically watched a roomful of my dad search the web (a new tool) for jobs.

It. Was. Awful.

Much like today, if you are unemployed and over 50, the prospects aren't great.

And now, companies easily lay off older, more expensive workers.  They usually have higher salaries and their benefits often cost more.


Reduce those FTEs, people!

FTEs are Full Time Employee hours.

Replace them with part-timers!  New hires!

Lower those costs!

Because these days, corporations are seeing that as the only way to make a profit, unfortunately.  Not cutting CEO pay or lavish executive bonuses.  Cutting the hours and benefits for the receptionist who answers the phone.  Whose annual salary is probably close to what the CEO makes in an hour.

And we're not talking business owners- we are talking about executives who may be dedicating their lives to the company, but when the newest offer comes along or they perform poorly and get canned, they move on to the next Fortune 500 company.

They are completely replaceable yet corporations treat them like demi-gods.

And they treat the receptionist like overhead.

I'm not talking communism as the fix-- I am talking about human decency, however.

It wouldn't need to be regulated if ethics and morals were prevalent in business.

As a business owner, I was vehemently opposed to mandating the minimum wage.  I don't pay my staff minimum- I haven't since my second year in business.  Because a human being would never pay someone as valuable as an employee that-- minimum wage was for interns and probationary periods- not to live on.

But alas, I guess I am naive.  It IS apparently considered a living wage- since those jobs aren't complex.


How would Wal-mart feel if every single one of their workers walked out who they paid less than $10?

They would stay in business about 5 seconds.

Those jobs aren't worthy of living wage?  Seriously?!?!  How do they think product gets off the docks and onto the shelves?  Who rings up the customer?  That's not of value?  It may not be complicated, but it certainly is valuable.

And again, if companies had any ethical conscious, it would not need to be mandated.

But when we, the taxpayers, are forced to subsidize someone's living through food stamps and welfare- someone who is working full-time- that seems wrong to me.  The corporations keep the profits, pay minimal if any taxes and we, the tax payers, supplement their workers' incomes?

Tell me what is fair about that?

I don't know what the secret dollar amount is for the minimum wage- because as a business owner, I don't need someone to tell me.  I'm not about paying the minimum.  I'm about paying what is fair and what is right.

Without my staff, I could not take a vacation. I could not be profitable.  I could not provide the level of service that I do for my clients.

I would never see them as overhead or costs.

It might be why I don't earn a million dollars, but if (and when) I do, they will be rewarded for the very signficant part they play in my success.

They are not overhead.  They are people with mortgages and tuition.  Insurance expenses and car payments.

They are not ID numbers.

They are my work family.

They are the single most valuable investment and component in my business.

Answering a phone is not complicated, but Julie makes it an experience for my clients.  Filing papers in not complicated, but Mike has never made a mistake.  Value over skill.  Their jobs have details and nuances that I don't even know about.  They make my life easier, they are integral in helping my business run and they take pride in their work.  They handle multiple task assignments, deal with all kinds of people- they are not just "staff."

I hear financial pundits saying that "unemployment needs to improve" all the while at their firms they are looking to shave overhead costs, i.e. people.

People aren't overhead just as corporations are not people.

So maybe if corporate America started behaving ethically, we wouldn't need legislation to guide them.  At the beginning of the 20th century the wealth was concentrated and the icons made their fortunes on the backs of poorly paid immigrants.

Does this sound familiar?

And you know what followed?  Labor uprisings. An economic depression.

Because as Detroit found out this century, when you lay everyone off, there's no one left to buy your cars.

Business ethics are essential to a thriving economy.  They should not have to be legislated.  In the periods of the biggest economic growth in the US, wages were livable and fair.

I would hope that every CEO who is insisting on cutting FTEs remembers that those numbers on a spreadsheet are people.  That a $20 million salary equals 450 jobs- which are 450 houses being built, 450 people who can invest in their 401k plans, 450 cars being bought.  Which is the better investment?

I don't begrudge people who are well-paid- I do pretty okay.  I've worked hard for it.  In fact, I started my business with $8.73 in my checking account.

And I've been successful due to many people's hard work, not just mine.

I took the risk as a business owner; I should be rewarded.  But corporate jobs?  Those high salaries?  Really?  Are people THAT amazing and unique?

If the receptionist is replaceable, I tend to think the CFO probably is as well.  I've never seen a firm collapse when someone's left- I've seen individuals cause damage, but everyone is replaceable.

My solution?

Public shaming, maybe?  I love that show "Undercover Boss"- maybe every CEO should participate.  And every EVP.  And every CFO.  And every WGAF (who gives a f***).

And maybe the next time they start cutting work hours, benefits, and retirement plans to the people who work just as hard every day, they can start with their own pay first and work down.

You know, trickle down theory.

1 CEO= 450 jobs.

You do the math.

As for me, I will continue to pay my staff well for work well done.  I will be mocked by colleagues for "giving it away" and I will not care.

I will fight for small business's rights over the protections of large corporations.

And I will continue to argue that Human Resources is fundamental to every business.  Not because it's the most profitable, but because it's the right thing to do.

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