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Small Cuts Help To Stave Off Layoffs

Even as layoffs reach historic levels, some employers in the United States have found an alternative to slashing their work forces. They're nipping and tucking instead.

A growing number of employers, hoping to avoid or limit layoffs, are introducing four-day workweeks, unpaid vacations and voluntary or enforced furloughs, along with wage freezes, pension cuts and flexible work schedules. These employers are still cutting labor costs, but hanging onto the labor.

In some cases, workers are even buying in. Witness the unusual suggestion made in early December by the chairman of the faculty senate at Brandeis University, who proposed that the school's 300 professors and instructors give up 1 percent of their pay.

"What we are doing is a symbolic gesture that has real consequences -- it can save a few jobs," said William Flesch, an English professor.

He said more than 30 percent had volunteered for the pay cut, which could save at least $100,000 and prevent layoffs for several employees. "It's not painless, but it is relatively painless and it could help some people," he said.

Some of these cooperative cost-cutting tactics, though not unique to this downturn, are effectively democratizing the cost-cutting process.

More broadly, the reasons behind the steps -- and the rationale for the sharp growth in their popularity in just the past month -- reflect the peculiarities of this recession, its sudden deepening and the changing dynamics of the global economy.

Companies trimming their work forces say this economy plunged so quickly in October that they do not want to prune too much, lest it should just as suddenly roar back. They also say they have been so careful about hiring and spending in recent years -- particularly in the past 12 months -- that highly productive workers, not slackers, remain on the payroll.

At some companies, employees are supporting the indirect wage...



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