Why a business may reduce its workforce
Reducing the workforce means a business has fewer employees.
Simple reasons
Machines do the work (automation)→ Fewer workers are needed
Sales go down→ Business cannot afford many workers
Factory, shop, or office closes→ Workers lose their jobs
Business moves to another country→ Jobs in the old place are lost
Two businesses join together (merger)→ Some jobs are repeated, so not needed
Ways workers can leave a job
1. Dismissal
Worker is removed because of bad behaviour or poor work
Examples:
Always late
Stealing
Not doing the job properly
2. Redundancy
Job is lost not because of the worker’s fault
Happens when:
Sales fall
Business uses machines
Worker may get money (redundancy pay)
3. Leaving by choice
Retirement – too old to work
Resignation – found another job
How businesses choose who to make redundant
Workers who volunteer
Workers with less experience
Workers with skills not needed
Workers with poor attendance or performance
Workers in departments that need fewer staff