FIRST the lay-ups and now the lay-offs – it seems the gathering winter gloom is being felt in boardrooms across the industry.
While the shipping industry is unlikely to face the large scale cut-backs that this week saw DHL axe close to 10,000 jobs in one go, we are already witnessing the first tentative outcomes of some very hard decisions being made.
Last week AP Moller-Maersk announced that it was closing one of its two global customer service centres in China, and will cut 700 jobs by mid-2009. Now it seems that around 120 jobs are facing the axe at Lloyd Werft thanks to order cancellations and lack of new contracts.
With container lines under pressure to slash yet more capacity from the suffering Asia-Europe trades, yards reporting order cancellations and ferry routes seemingly being pulled by the day, it is unlikely that these will be the last redundancies we see in the short term.
The fact that these decisions are being made amid the dire economic outlook, however, should offer a small ray of hope. It is a myth to think that job cuts in a down-turn period is the panacea for all ills and no manager worth employing is going to be dumping valuable assets without good reason. The implication here is that the situation is at least now tangible and these cut backs are being made in response to a considered strategy on how to navigate a path through the downturn.
Careful fat carving exercises that leave a company scaled-back but efficient enough to survive the winter ahead are inevitably going to be a painful but necessary reality for many. Judging the right time to make these decisions and avoiding long-lasting damage to the muscle of the work force however is a tough operation that calls for skill and careful consideration.
