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Maersk to cut 10k jobs as shipping demand drops

reuters.com

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Re: Maersk to cut 10k jobs as shipping demand drops

#101

Post by McDyver »

AnimalMuppet wrote: post #96
clnq wrote: post #72

Earlier quoted context omitted.

Assuming there is some ebb and flow in demand, they should keep employees around with nothing to do, yes. Moreover, there is natural attrition. They can stop hiring, promote internally, and so on, until they’ve reached their desired head count. The point is that both of these are doable when the company is wildly profitable. And they should be done for the negative secondary effects of layoffs (ruining lives, morale…

> Assuming there is some ebb and flow in demand, they should keep employees around with nothing to do, yes. Disagree. Especially if they knew they were hired for a surge that would end.

Then they should have hired contractors for the specific timeframe, no?

Otherwise it's just corporate greed: we know we'll have a surge in demand, so we buy new vessels and containers and manpower to last us 2 years; we make huge profits, discard this surplus and blame it on the "new normal" (FTA)

Re: Maersk to cut 10k jobs as shipping demand drops

#102

Post by marcosdumay »

tyingq wrote: post #62
chrisdbanks wrote: post #52

Earlier quoted context omitted.

Your electricity demands probably change drastically between summer and winter. Do you not use electricity during the winter because you know you won't need as much during the summer? People are a resource just like electric. There needs to be flexibility for elasticity. This is why redundancy exists as a concept. Of course people should be compensated for elastic demand and you can of course always seek to increase…

Right, and for example, contractors are often a better match for fluctuating demand rather than employees. Or diversification of market offerings to reduce seasonality. Or skill diversification for employees so they can be repositioned during low demand in one area, etc. Or at least being up-front about the temporary nature of the employment and structuring the program to suit that. "Seasonal hires" have a different…

> contractors are often a better match for fluctuating demand rather than employees

Not when it's universal and systemic.

> Or diversification of market offerings to reduce seasonality

And this is good, but really too much to ask if you are going to require it.

> skill diversification for employees so they can be repositioned during low demand in one area

This also doesn't work when the changes are global and systemic. But then, most of the layoffs we have seen in the past were rushed things that didn't even bother to evaluate this option. This one cuts me as done in around the shortest timing to make this possible, so we'd need to check if they tried it or not.

We also don't know if they were up-front about the temporary nature of those employees. They are certainly not formally temporary because the timing doesn't work here (what is good for the employees anyway), but we don't know if they were warned.

Re: Maersk to cut 10k jobs as shipping demand drops

#103

Post by candu »

salmonlogs wrote: post #6

> Danish shipping giant Maersk has posted earnings before interest and taxes (EBIT) of $30.9bn for the full year ended 31 December 2022, a 57% surge from $19.6bn in 2021. > This is said to be the firm’s best-ever annual result. https://www.ship-technology.com/news/maersk-logs-record-prof... Really sad to see these companies make enormous record beating profits then months later do mass layoffs just to maintain better…

Well, for their Danish employees at least, they’ll get 3-6 months notice, and they’ll be required to negotiate with employee representatives due to the size of layoffs.

And then a combination of public and private unemployment benefits kick in. And if you want to e.g. retrain or pursue a graduate degree, there’s support for that too.

So there’s a solid safety net, but employers are also required to shoulder some responsibility for supporting terminated employees.

Re: Maersk to cut 10k jobs as shipping demand drops

#104

Post by mschuster91 »

lotsofpulp wrote: post #47
mschuster91 wrote: post #18

Earlier quoted context omitted.

Good C-level execs actually care about staff retention and fluctuation rates. The really good ones make HR ask about departure reasons in exit interviews and act accordingly - given that each departure costs a significant amount of money in hiring and training costs, it makes sense to weed out bad mid-level managers.

> given that each departure costs a significant amount of money in hiring and training costs For every job in every business around the world? I doubt it.

Every job has at least 2 weeks worth of training cost. Even fast food or shelf stocking.

Re: Maersk to cut 10k jobs as shipping demand drops

#105

Post by mschuster91 »

matwood wrote: post #48
mschuster91 wrote: post #19

Earlier quoted context omitted.

Keep the headcount as high as possible while still turning a profit so they can react on demand going up again in a short notice.

Anything done to keep headcount above necessary levels would have caused slower hiring and in turn caused the demand shock to go on even longer. I'm curious about your solution though. How many people do they need to keep on staff that are not doing anything? How much profit are they allowed? Do they have to lose money before they are allowed to trim the workforce? Do they need to be prepared for another COVID-level…

> How many people do they need to keep on staff that are not doing anything?

They could also reduce the amount of hours that everyone works. It's high time for another reduction in hours-per-week anyway.

> Do they have to lose money before they are allowed to trim the workforce?

In a society that values its citizens over its corporations, yes.

> Do they need to be prepared for another COVID-level demand surge?

It's not unlikely that there will be a surge once the Russians get booted out of Ukraine.

Re: Maersk to cut 10k jobs as shipping demand drops

#106

Post by ptnpzwqd »

boeingUH60 wrote: post #25
salmonlogs wrote: post #6

> Danish shipping giant Maersk has posted earnings before interest and taxes (EBIT) of $30.9bn for the full year ended 31 December 2022, a 57% surge from $19.6bn in 2021. > This is said to be the firm’s best-ever annual result. https://www.ship-technology.com/news/maersk-logs-record-prof... Really sad to see these companies make enormous record beating profits then months later do mass layoffs just to maintain better…

Do you suggest they keep employees around with nothing to do because of significantly reduced shipping demand? I agree with your point about getting laid off being awful, but I think this should be solved by the government having a robust social safety net (funded by taxes) so that getting laid off doesn’t cause stress. Fortunately, Denmark already scores high in this area.

This makes the assumption that the increase in headcount was to cover the surge in demand, and the additional assumption that the additional headcount was needed to satisfy the demand (obviously, some of it might).

For technology in particular (which seems to be one of the affected functions), this is hardly the way it works - tech projects are unlikely to be a good way to handle temporary spikes in demand, etc. Even for more specialized non-tech functions the lead time for getting someone productive can be too long to make this a feasible strategy.

Maybe also particularly for tech, but I suspect it is much more likely that the "good times" gave the company a large appetite for longer term strategic initiatives/investments, and now that tides have turned that appetite has gone too.

There is no way that it has come as a surprise that the market would change eventually, and creating and killing long term initiatives as the market goes up and down is bad planning, bad for the people affected and bad for the company as well.

Re: Maersk to cut 10k jobs as shipping demand drops

#108

Post by jryle70 »

tyingq wrote: post #31
boeingUH60 wrote: post #25

Earlier quoted context omitted.

Do you suggest they keep employees around with nothing to do because of significantly reduced shipping demand? I agree with your point about getting laid off being awful, but I think this should be solved by the government having a robust social safety net (funded by taxes) so that getting laid off doesn’t cause stress. Fortunately, Denmark already scores high in this area.

>Do you suggest they keep employees around with nothing to do because of significantly reduced shipping demand? It's not unheard of in the past to resort to salary cuts, reduced hours, etc, while they bridge some solution or wait out what might be temporary. There's also the notion of better planning. If you suspect, for example, a demand spike is temporary...there are ways to deal with that other than overhiring emp…

They went from 80k employees in 2020 to 100k in 2022 (mentioned somewhere in this thread). Now they cut 10k. Maybe that is good planning? Maybe over hiring make responding to demand quicker? There are all kind of consideration, and yet people are quick to blame them without knowing facts.

Re: Maersk to cut 10k jobs as shipping demand drops

#109

Post by manonthewall »

boeingUH60 wrote: post #25
salmonlogs wrote: post #6

> Danish shipping giant Maersk has posted earnings before interest and taxes (EBIT) of $30.9bn for the full year ended 31 December 2022, a 57% surge from $19.6bn in 2021. > This is said to be the firm’s best-ever annual result. https://www.ship-technology.com/news/maersk-logs-record-prof... Really sad to see these companies make enormous record beating profits then months later do mass layoffs just to maintain better…

Do you suggest they keep employees around with nothing to do because of significantly reduced shipping demand? I agree with your point about getting laid off being awful, but I think this should be solved by the government having a robust social safety net (funded by taxes) so that getting laid off doesn’t cause stress. Fortunately, Denmark already scores high in this area.

I think they're saying "stop complaining, it's tit for tat, so don't cry anymore big companies that hold 90% of the power"

Re: Maersk to cut 10k jobs as shipping demand drops

#110

Post by Proven »

salmonlogs wrote: post #6

> Danish shipping giant Maersk has posted earnings before interest and taxes (EBIT) of $30.9bn for the full year ended 31 December 2022, a 57% surge from $19.6bn in 2021. > This is said to be the firm’s best-ever annual result. https://www.ship-technology.com/news/maersk-logs-record-prof... Really sad to see these companies make enormous record beating profits then months later do mass layoffs just to maintain better…

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