Employment rates are holding steady according to U.S. Secretary of Labor Tom Perez. On April 3, Mr. Perez cited a recent jobs report that boasted 61 consecutive months of private sector growth. Although 129,000 jobs were created in March, many are still struggling with the threat of layoffs. Read on to learn the warning signs of a financially-unstable employer. Early detection will help you prepare and protect your savings.
So, is your employer in trouble? Red flag behavior includes:
- Out with the full-timers, in with the contractors. Layoffs are hard to miss, especially if you work in a large office or factory setting. A sudden increase in full-time firings or layoffs is a sign of trouble. This is especially true if your former co-workers are replaced by hourly contractors. Your employer may be attempting to save money by limiting overhead, including paid time off, full healthcare coverage and other benefits. While it may not be wise to confront your boss directly, pay attention to staff changes. At the very least, start updating your résumé.
- A sudden interest in your “daily value.” If you’ve seen Office Space, you now understand the stress of answering the question, “What would you say you do here?” Unless your work has recently suffered, this question is especially troubling. A company experiencing financial strain will take stock of their employees to identify essential—and expendable—personnel. Unfortunately, even the best leadership skills won’t save you from a failing workplace. Answer your employer’s questions and ask a few of your own. The writing on the wall will help you decide how to proceed.
- An increase in cost-cutting measures. The winds have changed in the office halls. There’s new talk of money-saving initiatives and your boss is preoccupied with the price of Post-It notes. Cutting back on office supplies and break room perks is a sign of trouble. While your employer may value frugality, overdoing it is cause for concern.
- Delayed paychecks. The worst red flag of all is a delayed paycheck. Consider the following example:
Cara is a 24-year-old copywriter working for a small agency. Her bosses (a husband and wife team) are friendly with their staff and regularly host company barbecues at their home. Despite their close relationship, Cara becomes worried when they inform her that her latest paycheck “is arriving a few days late.” She gives them the benefit of the doubt, but the same issue occurs the following month.
The bottom line: Friendliness won’t pay the bills. An employer who asks you to “be flexible,” “understand,” or “be a team player” when it comes to payment is in serious trouble. Not only is withholding wages illegal, it’s a likely sign of impending closure or bankruptcy. Say no to these requests and find a new job as soon as possible. Don’t let an employer’s money problems affect your financial safety.