If you've been laid off, you're not alone. In these tough times, roughly 4.5 million people are claiming unemployment aid. And according to financial columnist Ben Stein, most of these folks are lazy.
In a recent column, Stein opined that our current recession is a doozy, since it's even affected people in his privileged circle. Many have lost their homes. Unfortunately, Stein went on to say that most of the unemployed are "people with poor work habits and poor personalities," adding that they are likely to be "people who have overbearing and unpleasant personalities and/or who do not know how to do a day's work."
Though Stein admits there are plenty of exceptions to his sweeping generalization, we're still not fans of his opinion.
Layoff logic
When Wells Fargo (NYSE: WFC) announced earlier this month that would let go 2,800 to 3,800 workers, was it truly cutting unproductive dead weight? Or was the company simply getting out of the subprime loan business, and therefore shutting down the division that made them?
IBM laid off 5,000 workers last year to move operations to India, where labor is less costly. Were the poor work habits of its U.S. employees to blame, or just economic calculations?
U.S. Steel announced a 3,500-person reduction back in 2008. Were most of those unlucky souls playing Minesweeper at their desks all day? Or had steel prices fallen, while the global economic slowdown had reduced the demand for steel?
Sure, there are lackluster workers in most organizations. But when companies lay off hundreds or thousands of people, they most often do so for business reasons. After all, many companies hire back those same workers. Truckmaker Oshkosh recalled some 600 workers when it scored a lucrative new contract last year. Ford (NYSE: F) rehired more than 1,000 workers earlier this year.
For us investors, it can be encouraging to see a great company recover and bring back dismissed workers. New hires or rehires likely boost the morale of its existing workforce. Companies like Lincoln Electric (Nasdaq: LECO), which maintain no-layoff policies, may have found an even better way attract and retain desirable workers. Southwest Airlines (NYSE: LUV) is another company with a no-layoff policy -- though interestingly, IBM used to have such a rule itself.
Some investors consider downsizing a way to make companies more efficient. Others assert that big layoffs go beyond "trimming the fat" to cut a business's muscle instead. But I doubt either side of the argument would agree that layoffs only serve to get rid of dead weight. That just doesn't make sense.
Check out the best dividend stock you can buy.
