This is an answer I made to a question on Linkedin today about the failure of leaders to sack under- performing people. I thought it worthwhile also posting my answer onto my blog so that more of my network could read it.

I believer that business is going through a revolution.

In past credit squeezes firms and Governments would shed talent to reduce costs (the UK Government is about to do this again by reducing civil service personnel by up to 25%). The result was that essential knowledge and skills were lost and recovery took longer as a result.
So, this time round, firms have attempted to retain their talent, even those less productive, as leaders hope for a quick upturn. The problem is that the upturn is slow in the west.

Further problems are that with coming food inflation and possible grain shortages, extended insecurity as the credit crunch continues and Government policy that increases tax whilst reduces spending businesses are now being forced to start to look to their staff costs. This means that some of the “good” people will be shed as well as the “bad” and that the trend is to hire part-time employees.

I suspect that the result is that the “business revolution” will generate a significant percentage of the working population having a number of part-time jobs as opposed to a single full time position. (including professional firms such as lawyers, accountants and financiers)

There is security in this position for employees who may be “shed or fired” in that income is not reliant on one employer and totally and immediately lost on redundancy whilst the employer has a capability of expanding and contracting a workforce more easily.

So, in my opinion, it’s not “under-performers being hired or fired” it’s that we may be witnessing a change in the way employment may work in the future.