Post 9/11 Layoffs, Hiring Freezes More Frequent than First Expected

September 9, 2002 (PLANSPONSOR.com) - More companies laid off and avoided hiring people than was expected shortly after the September 11 terrorist attacks last year, but employees' compensation suffered less than expected, a survey found.

More than a third of respondents to a WorldatWork survey said their companies had put employees on the street in the last year – a much higher rate than the 9% who reported considering layoffs in a similar survey conducted in October 2001, just after the attacks.

Also, a fifth of respondents said had hiring freezes since September 11, more than the 14% reported considering such moves in the last study.

For more stories like this, sign up for the PLANSPONSOR NEWSDash daily newsletter.

On the positive side, both pay freezes and pay cuts since September 11 appear to have not been as bad as was initially planned in October 2001.

According to the survey, 10% of organizations actually implemented pay freezes since mid-October 2001, compared to 22% that predicted they would last October. And only 3% of companies cut pay, compared to 12% that predicted they would.

Even companies’ always fickle appetite for business travel didn’t take as much of a hit as expected. The latest survey showed 49% actually cut back how often their workers could take to the skies – a good bit below the 62% who predicted a travel decrease last year.

The survey had 495 respondents from among members of the workplace compensation group.

«