Bottom Line: Globally, 31% Percent of organizations across 6 continents believe that their business results to be significantly worse than their targets for 2008. Retail is the hardest hit sector. The result is that 48% of these organizations are freezing hiring and 65% are cutting pay. Based a survey of 2500+ organizations by the Hay’s Group.

More Information:

• Staffing Freezes and Decreases Globally: Nearly half (48%) of organizations globally are decreasing or freezing existing staffing levels, up from 20% in the March study. For those planning layoffs, median staffing level decreases are approximately 7.5%. Only 3% of organizations globally are planning to increase staffing levels.
• Base Salary Increases Getting Cut: One of the biggest areas for cuts is base salary increases –sixty-five percent of respondents are making changes or considering changes to their previously established base salary increase budgets for 2009. Of those organizations, 58% are decreasing their budgets and 24% are freezing or considering freezing salaries for all employees.
• HR Programs Hitting the Chopping Block: Training and development programs are being decreased or eliminated by 16% of organizations responding to the survey. Companies are also cutting overtime wages (11%) and the use of contract laborers (17%). However, most are keeping benefits programs relatively in-tact at this time, including health and retirement plans.
• Employees Worry about Job Security the Most: Respondents reported their employees’ top concerns center around job security, fear of layoffs, salary concerns (e.g., reduced merit and frozen salaries), the cost-of-living and inflation, reduced revenue and customer retention, and lack of a bonus pay-out.
• Companies Worry Most about Top Talent: Consistent with the findings from the March survey, the top concerns of organizations include retaining top talent and critical skills, maintaining and affording competitive pay, maintaining employee engagement and motivation, career development and training opportunities, and recruiting top talent and employees with critical skills.

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