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NEW YORK, October 25, 2000—Major U.S. companies
grew their workforces by an average annual rate of 5.9% despite higher
turnover and a daunting lack of skilled workers, according to the American
Management Association’s (AMA) yearly Staffing and Structure Survey,
released today.
The 5.9% growth rate for the twelve months ending in
June 2000 marks an increase from 5.0% in the previous twelve months. Turnover
rates averaged 19%, up from 16.9%, and 76% of surveyed human resources
managers said that skilled manpower was “scarce,” significantly
higher than 66% in 1999 and 52% in 1997.
Even in this tight employment marketplace, more than
three-quarters (77.8%) of the 1,441 surveyed firms created new jobs over
the year while only 48.2% reported job cuts, slightly down from the previous
49.6%. Thirty-six percent reported concurrent hiring and firing, the highest
level in the survey’s thirteen-year history, and actual “downsizing”ßdefined
as a net decline in the total workforce—dipped to 21.2% from the
previous year’s 24.1%.
“Companies have learned that downsizing and job
cuts by themselves don’t automatically increase profitability,”
said Eric Rolfe Greenberg, AMA’s director of management studies.
“Instead, management is focusing on the work that adds value and
creates a competitive advantage in the marketplace, not solely on the
number of jobs added or eliminated. Companies that have consistently hired
AND fired since 1995 have outperformed all others, including those who
created new jobs but eliminated none over the same period.”
Fewer than half of companies reporting job elimination
actually downsized (40%). In fact, hiring far outweighed firing in respondent
firms. As a group, respondent companies created four new jobs for every
one they cut in the twelve month surveyed period. Additionally, half (50%)
the surveyed companies plan job creation within the next year, up from
48.2%, while only 20.5% anticipate job cuts in the same period.
“We have found that in both the short-term and
the long-term, growing companies tend to outperform downsized firms, especially
in such areas as employee morale and turnover rates,” stated Ellen
Bayer, Global Human Resource Practice Leader for the AMA. “Flexibility
and agility in staffing combined with an increased investment in training
enhance the work environment and also improve corporate performance. Furthermore,
54% of companies that increased their training activities over the past
year reported profit improvement, compared with 36% of all others,”
added Bayer.
To view a comprehensive summary of the 2000 AMA Staffing
& Structure Survey results visit the AMA research site at: http://www.amanet.org/research.
Note to editors: For more information regarding
this survey or other AMA research please contact Eric Greenberg, AMA’s
Director of Management Studies at 212-903-8052 or egreenberg@amanet.org.
About AMA
American Management Association (AMA) is the world’s leading
membership-based management development organization. AMA offers a full
range of business education and management development programs for individuals
and organizations in Europe, the Americas and Asia. More than 700,000
AMA customers and members a year, including 488 out of the Fortune 500
companies, learn superior business skills and best management practices
through a variety of seminars, conferences and special events, e-learning
courses, assessments and customized learning solutions, publications,
on-line resources and through interaction with AMA’s faculty of top
practitioners.
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