Packaging Industry risks sabotaging future with redundancies
When times are tough redundancies may be necessary but the packaging industry faces very specific challenges, which mean perhaps redundancy should be a last resort.
The first quarter of 2011 saw recruitment reach levels not seen since 2007 and the 2nd quarter is following a similar pattern. However there are inevitably still sectors and individual companies struggling and so we continue to see redundancies. They are not wide spread or endemic but are still there despite the positive indicators in the market.
Of course there are issues in the wider economy and the fallout from proposed public sector cuts could affect consumer confidence; which in turn could impact on packaging volumes. It is not unreasonable to suggest though that the economy has already started a recovery and that within 18 months we could see a more sustained up turn.
Cutting heads now could be especially risky to the packaging industry for the following reasons:
Many roles within the packaging sector, from machine operators to skilled designers, sales and management staff, are characterised by specialised, niche knowledge and skills. If we loose these people from the sector, or fail to keep them up to date with industry trends and technology, we could struggle to replace them. For some roles there are already marked skills shortages.
The packaging industry is geographically very spread out across the country with few areas having a significant concentration even within specific sectors. The result is two fold; redundant staff will either leave the region or leave the industry so when the time come to increase capacity again there may not be anyone to recruit locally. Further the absence of a concentration of similar companies means there is no local talent pool being trained and progressing their careers through several employers. This pipeline of talent historically provided a market within the talent pool for specific roles within specific industries. So if you are the only employer of a given type in your area, you are not providing a career ladder for trainees, and make people redundant; it is unlikely you have access to the niche skills when you need to expand.
There are of course alternatives to redundancy. although I know they wont be appropriate to all they should at least be considered. In this process I would urge both unions and individual employees to take a longer term view and acknowledge that some initial pain may be worth it in the long run.
Alternatives to redundancy may include:
Changes to working patterns / shorter hours
Secondment / redeployment to other parts of the company (which may include some re-training)
Educational sabbatical (taking unpaid or reduced pay time away from work for work related study or training)
Reduced conditions (across the board pay cuts etc.)
Obviously some of these, particularly pay cuts, will be unpalatable and probably the natural inclination of those on the receiving end is to resist them. However for the individual having a job to go to, having an employer survive back into the good times and a return to their original conditions should be attractive. For employers maintaining the intrinsic strength in the business, perhaps even improving it, during the tough times will pay dividends when demand increases.