The Great Recession 2007 Essay

Submitted By JdChillstrong1
Words: 1010
Pages: 5

The “Great Recession” 2007

Paper #1
MSB 609: Human Capital Management
By Roy Maleh
We seem to often remember the good times but it is always difficult to forget the bad times. The U.S. has definitively had its share of ups and downs. The "Great Recession" that began in December of 2007, was one that we still find ourselves struggling to recover from. This recession drove many organizations to scale back their operations--especially within the human resources. In this paper, I aim to focus on two human capital areas that have been dramatically affected by the recession and determine if these organizations made the correct decisions.
Following the Great Recession, many organizations decided to down-size various departments within their companies. In the human capital area, Motivation and Retention has been significantly affected. According to the reading, “The 2007-09 Recession And Health Insurance Coverage” by John Holahan, due to the recession there was a loss of employment, followed by a decline of income, which led to millions of Americans that had lost employment-based insurances (Holahan, 2011). I read somewhere that Motivation is one of the most researched topics in management literature. Motivation is reported to lead to high efficiency, when each individual task is studied and perfected. Collectively, organizations have come up with many strategies for motivating the employee. Fortunately, most of the concepts are consistent and relatively simple. I believe that if you want to create a positive employee motivation atmosphere, treat employees as if they matter - because employees matter. Compensation and benefits are both highly effective Motivation elements. Compensation is the total amount of the monetary and non-monetary pay provided to an employee by an employer in return for work performed as required. Compensation can include payments such as bonuses, profit sharing, overtime pay, recognition rewards and checks, and sales commission. Compensation can also include non-monetary perks such as a company-paid car, stock options in certain instances, company-paid housing, and other non-monetary, but taxable, income items. Deciding to scale down compensation within Human Resources was most likely a decision that was not taken lightly. Compensation motivates employees to work hard and improve their productivity. It also reduces employee turnover and helps in creating a great atmosphere to work in the organization. Unfortunately, we still have not brought the unemployment rate down to pre-recession levels (Schramm, 2010). Benefits are various non-cash compensations provided to employees in addition to their normal wages/salaries. Interestingly, an employee can exchange cash for some other form of benefits too, known as salary packaging. Some examples of benefits include, but are not limited to: health insurance, housing, disability income protection, retirement benefits, daycare, tuition reimbursement, sick leave, vacation, social security, profit sharing, funding of education, and other specialized benefits. Retention is an effort by an organization to maintain a working environment which supports current staff in remaining with the company and reduce the substantial costs involved in hiring and training new staff. Many Employee Retention policies are aimed at addressing the various needs of employees to enhance their job satisfaction and reduce the substantial costs involved in hiring and training new staff. Ironically, employers believe that given the rough economy, workers are thrilled just to have a steady paycheck. Meanwhile in reality, employees are frustrated and secretly seeking new opportunities. And most likely which soon could be scooped up by another company as the economy begins to recover (Petrecca, 2009). As we know stakeholders are groups/individuals that are affected by and/or have an interest in the operations and objectives of the business. Most businesses have a variety of stakeholder