More Workers Face Pay Cuts, Not Furloughs

[groovedaddy]

The furloughs that popped up during the recession are being replaced by a highly unusual tactic: actual cuts in pay.

Local and state governments, as well as some companies, are squeezing their employees to work the same amount for less money in cost-saving measures that are often described as a last-ditch effort to avoid layoffs.

A new report on Tuesday showed a slight dip in overall wages and salaries in June, caused partly by employees working fewer hours.

Though average hourly pay is still higher than when the recession began, the new wage rollbacks feed worries that the economy has weakened and could even be at risk of deflation. That is when the prices of goods and assets fall and people withhold spending as they wait for prices to drop further, a familiar idea to those following the recent housing market.

http://www.nytimes.com/2010/08/04/business/economy/04paycuts.html?_r=1&th&emc=th

[marmar]

1. Race to the Bottom....at Usain Bolt-speed.

nt

[Newest Reality]

2. Queue

the ooos and ahhhs of gaggles of surprised economists!

"Shockingly unexpected!" they exclaimed with scrunched-up faces and raised eyebrows.

[stray cat]

3. would you take a paycut to keep your colleague employed?

[groovedaddy]

5. Your question reminds of something that happened years ago with a trucking company.

It was a Teamster shop.
The company had fallen on hard times and asked employees to reinvest their pensions in the company to save it. About half the employees agreed and put up their pensions. 3 months or so later, the company went belly up, along with the pension money. Of course the ones who held on to their pensions felt a hell of lot better about their decision.

[earthside]

4. Is this good news?

What do the 'recovery' Pollyanna's have to say about this development?

[Omaha Steve]

6. Local and state governments

That is me. And the states largest union is State of Ne. employees. Both AFSCME locals in the state have lawsuits in progress for breaking items in their contracts.

K&R!

OS