Wrong on some counts, chupacabra.
Cobra payments are made by the employee, not the employer, so there is not cost to the employer.
If you cut someone's pay, you still have to pay for their health insurance, or whatever part of that you normally pay .
Your workers comp charge does not really go up until about a year after layoff occurrences.
Most firms now are looking at short term costs. Yes, it costs something to lose a good person, there is the training, etc., but short term, you save much more getting rid of a person and all of the payroll and benefits than cutting other peoples wages and hours. Of course, if owners can get away with wage cuts and keeping everyone full time, they are then ahead.
Studying and filing and other non-billable time consumption may be tolerated for several weeks, but a firm needs to cut non-billable personnel quickly if it will survive these economic times. Many architectural firms (almost always the small firms, but also some mid to larger firms) don't have the cash reserves to "float" the staff for months on end. Often the principal(s) have taken out short-term loans, using their unpaid invoices as collateral, to cover payroll during cash shortages.
But note that many firms now have uncollectable invoices accruing, because a developer who isn't proceeding with his project, who doesn't have a construction loan, is also a client not paying his bills. Witness the large liens placed by Perkins & Will on the Spire and other projects. But you can't collect on a lien until the owner sells his property; the lien just sits there.
Lay-offs are terrible. But sometimes lay-offs are the only action available to a firm, even the large firms. Even a substantial salary cut for a SOM principal might save only a handful of positions for several months; don't kid yourself.
Update: Callison has laid off more employees in Seattle and New York already this month. Rumor on the street is that they, through continued terminations/layoffs will be at 400 (down 50%) by spring. The private equity firm that bought into the company is controlling the strings I'm told. Callison, which has a long standing reputation for standing by it's people has caved to the desires of their new owners. Friends who work there and who used to work there said it isn't the place it used to be in the past years. It's panic in the streets folks.
"i bet if most firms took a vote, everyone would rather people get laid off ... before everyone taking a collective hit for the team"
where you come down on this issue is, I think, very much a function of the firm in question and its culture. some firms actually do have an "one for all / all for one" culture and the idea of pain-sharing to keep the core team together actually works and strengthens the firm's culture even further.
nevertheless, it's rarely (if ever) a democratic process or decision ... the owners of the firm generally approach decisions of this nature with a view toward what's in the strategic, long-term best interests of the company.
at any rate, our firm is about to find out -- we've had all the layoffs we think we can afford without cutting deeply into real muscle -- if we have to reduce payroll further (a day-to-day thing, due to funky cash flow) we'll probably go to a reduced workweek, with commensurate pay cuts all around. we will, however, continue to provide full medical benefits.
If you want to save your jobs: This is on the Senate floor today!
Contact Your Senator's Today and let them know your against Lieverman on this one.
Senator Lieberman is negotiating at the Senate level to deplete 2/3 of the allocated spending for green federal buildings across the country, thus reducing a $6 million allocation to $2 million. This dramatically impacts the design and construction industry in a negative way.
Lieberman is an idiot. I sent a note to both Senator Webb and Senator Warner about the stimulus and the importance of infastructure, energy effiency and mass transit and their importance to the design and construction community.
Lieberman is a right wing nut job who only won the senate race because the republican candidate was indicted on corruption charges a few weeks before the election and got less than 6% of the vote.
I hope Connecticut voters recall that idiot and then drive him out of the state and out of the US
babs - you're right in that firm culture plays a huge part in that kind of decision. my main point was the time duration involved - if it's short term, i think almost everyone would be down with taking a reduction to keep the team intact. what would be more difficult is, if the time length was indeterminable, would people do that? i'm not so sure people would take 20% cuts for a year if the alternative was to fire 1/5 of the staff that obviously could be done without.
: yes, well ... length of time anticipated is a material factor when deciding between paycuts and layoffs ... thanks for that clarifying observation ... the hard part is really knowing how long the economic difficulties will last ... crystal balls being the imperfect instruments they are, it's not always easy to tell at the beginning what the duration is likely to be ... our firm believes the duration will be fairly short ... if we're wrong, then further layoffs may need to happen ... we think a reduced work week would be an appropriate strategy for us until the picture clears.
Well that advice seems to be fine for you to give. Why is it not a thoughtful or constructive comment when i propose that you may want to think about setting something up? You never know. This economy may not pick up for some time? How many cuts can you make before you make it to your own throat? You really don't want to get to far into my dish.
In addition, this is a thread about being laid off. If you want to comment upon a firm's rationale for laying people off and the sacrfices that must be made to keep your little mom and pop enterprise afloat then by all means create a topic about it. But the fact is most people who have been given the pink slip don't really give a rats ass about what you must endure as a firm owner. Their pain isn't resolved or lessened by your comments; which are neither thoughtful nor constructive.
The only thing a guy like me gives a rats ass about is my employment and being able to hang onto my employment. We don't really give a flying fuck about of your excuses (whether they're justified or not) as to why you need to let people go. We've heard them all before and it's the same tire, worn-out, 1950s mentality rubbish that has been tried over and over and over.
At one of my friend's last firm, he was one of many who were rounded up in a group like cattle and was told of the "situation." He just walked out of the room as soon as the principal said they were being laid off. Does anyone really need to listen to the ensuing horseshit after being told THAT news?
Archmed,
No one wants to be laid off, and no one wants to lay off employees. You can not give a rats ass, but you should at least want to understand things from your employers viewpoint for so many reasons:
- If you understand what makes an employer keep on employee and ditch another, you have a better chance of staying employed.
- someone who only has an employee mentality will not go very far, and is probably one of the first people laid off. If I am going to go into debt and take out a loan, go without any salary at all, and remortgage my house to keep you employed while I have no work for your to do, I better be damn sure you will return the loyalty and stick around when the pendulum swings back and firms are hiring again. But someone with the rats ass philosophy of life probably would not be work the risk on my part.
- If you understand the employers viewpoint, perhaps you can head off being laid off completely by volunteering to work part time, or take a pay cut, if this works for you.
- If you understand the employers viewpoint, chances are you will be one of the ones hired back first when things pick up, instead of the bitter person who lets their tight beret make them unemployable in a firm.
- you might be an owner of a firm someday you know.
I always envisioned...Periodbritches with a cape codish look you know topsiders, ponytail, and a wicked accent! Now I better get back to work before I get tossed out of my own architecture office.
Archie, archie, archie, you're doing it too. We've already heard all of this millions and millions of times and it gets so repetitive, so asinine, and sooooooo tired -- It's like like people never really got over the 1950s business model and continue rehashing the same nightmare again and again. You will tell us about how "difficult" it is for you to make these decisions and then herd about 50 people into a room and categorically toss them onto the streets like rubbish while shedding a few crocodile tears. You don't think we've experienced this before?
In the end of the day you're still sitting pretty high atop your perch at XYZ Design with the profits you received in the boom times of 2004-2007. In the meantime, we're all out on the streets begging, heaping, and groveling for one of your little "informational interviews." And those of us who were fortunate to last through your third round of layoffs will sacrifice just about everything we have left (including our dignity and pride) to do as much work as possible and do whatever we can to keep our already unsatisfactory pay and pray every day that you don't either reduce our salary or flat out toss us onto the street like a the vermin we are. We're the ones losing sleep and having nightmares about the specific nature of how you plan on delivering the "great news" to us. We already understand all of this. Do you really think we need to be hearing these fucking lame excuses here too?
I know you hate to hear this but this is just how we feel. There are a lot of firms out there and a lot of firms do things differently. And in many cases you and many like you will look like the villains. Whether or not you're directly responsible, as a person in the upper management of a tanking firm, people will look at you and your actions in contributing to the downfall while having to categorically destroy ones livelihood.
Vado.....If I lay myself off there is no one to finish up all my projects....and that would piss alot of people off. So think I will
go get laid instood.....and come back on Monday and worry about the economy.
i am not necessarily a fan of anybody but i don't see anything wrong with bab's, archies or the others' posts about how the other side (actually in most cases, we as architects, are all on the same side, just different levels) go through the economic downturns. they don't deserve this angst.
let's say you have 10 employees, a relatively small firm. each costs 7k a month. how would you go to sleep thinking you have to come up with 70k at the end of the month when you have been borrowing heavily the last few months to keep everybody employed. it adds up in a speed of light and if you don't take action, you have lost everything.
how i wish, for years, to have a regular job and receive a paycheck like everybodyelse and go home and make monthly financial plans etc...
or, go out and get a decent camera instead of my 4 mp one i have been using for many pictures here and in my blog. but i still take good pictures with my cheap camera and it doesn't stop me taking pictures.
"waiting for nothing," it is a great phrase and great book written during the depression years.
stop blaming others. i don't want to feel sorry for you. not because you might lose your job but you let your fear and anger take over and might misjudge people. these are the same people you'll be knocking their door when the economy is better. they will hire you to be a part of the project they got. you might have your own business by then but there will be others who will want that job. as an architect you are a little bit more advantageous than an auto worker in terms of picking your employer.
yes there are a lot of owners out there who are greedy and will drive a late model ferrari while your transmission needs immediate work, but there are also many who just want to enterprise running so everybody has a job and paycheck to feed their families.
archmed, you are painting the employers like bunch of vampires. why have you been near these people all this time?
go out and be a starving artist like some of us. we don't have guaranteed meal or health insurance but we also don't have anybody breathing on our back either. find out which fits your personality and philosophy best. it is not the end of the world. maybe you learn to be independent of these people along the way. stop the fear killing the soul.
if you are going to do the talk, do the walk. start organizing your fellow workers and take action, if any.
In all seriousness I agree with Orahn. Who knows who will ride out this turmoil, but as a tiny small practice. Others are starting to understand a bit what it is like. I hate it when I have to upgrade equipment, I hate it when I have to lay out money for insurance, but we do it. We work long hard days and nights if we have to.
We are fortunate in we do have a nice blend of work some low end residential some high end residential, some school work, some industrial and some bank work. We are small, we work smart and quick, we keep the client first and always always try to keep the project on budget. We are always respectful of contractors.
I think this is the reason I have yet another project contract signing on Monday, when people are saying nothing is happening.
A time will come when this is behind us and we will be grateful for our many blessings, like good health, loving dogs, and Spring Grass!
:" We don't really give a flying fuck about of your excuses (whether they're justified or not) as to why you need to let people go. "
The corollary to that narrow view is a firm not really giving a 'flying fuck' about your continued employment when faced with a huge payroll and rapidly declining revenues.
If you're not remotely empathetic to the environment in which you work then you deserve what happens to you. Firms understand which employees "get it" and which don't. They tend to bet on those who do.
archmed - how many firms have you worked for in your career?
I've been through several rounds of layoffs at various firms... some offices are better at clueing in their staff to what is happening than others... People aren't as pissed off at what is happening if upper management explains what's going on with the business. yes, some principals are assholes who don't care about their staff... but most do care - they made the investment in finding good people, and it's extremely hard for them to let anyone go... but if they are bad about communication, then people are going to think they don't care even if they do.
archmed - i think most of us can empathize with your obvious anger and insecurity in this market environment. however, you are absolutely clueless as to how firms run.
try this (as orhan, i, and others have outlined): take your personally savings from the 'boom times', put it at risk, and burn through it to keep all of the 'underpaid' staff you have employed for the next 6 months. when there is simply about half the income you need to make the office work. don't like it coming out of your pocket directly? well, try to get a line of credit established (if you can these days). what? the bank wants me to personally guarantee that loan with my savings, my house, my car, etc?
point is - most of what's happening in this economy is beyond anyone's control. entire market segments just disappeared overnight - blame the bankers, investment managers, and whoever created the credit default option if you must. i don't know of anyone who wouldn't rather be in a mild slowdown, but know they have 2 years of backlog on the books. it's just not the case and it's not because of poor management alone.
: "We're all victims of someone else's mistake. We've done nothing wrong here."
I really see little point in expressing sentiments of this nature - it's almost like there's class warfare going on. Such sentiments - while perhaps stress relieving - are, in my view, unhelpful.
The simple fact is that the markets in which architects operate are volatile and cyclical. They don't really teach that idea very much in school. but any of the old hands here know it to be true and unchangeable.
For many very good reasons, firms don't (can't) keep a lot of money in the firm to support down periods - these reasons are mostly tax related. When the market shifts, payroll - particularly underutilized payroll - becomes a huge burden to the firm's viability.
Nobody within the profession - neither firms nor employees - have necessarily 'done anything wrong' here. Firms staffed up in the past few years because the work expanded - this created employment. When the market turned - suddenly and unexpectedly - firms found the level of staffing they were carrying to be unsustainable.
Layoffs are painful and costly and regrettable on both sides. But, the simple fact is that underutilized labor is extraordinarily expensive and unsustainable by any firm for very long.
I recognize the temptation to demonize "the firm" when layoffs take place. With greater maturity you may come to realize that most firms already carry unneeded labor much longer - and make financial sacrifices much larger - than is really healthy for the firm's financial strength.
These are lamentable times. But, the demons aren't necessarily to be found within the profession.
take your personally savings from the 'boom times', put it at risk, and burn through it to keep all of the 'underpaid' staff you have employed for the next 6 months. when there is simply about half the income you need to make the office work. don't like it coming out of your pocket directly? well, try to get a line of credit established (if you can these days). what? the bank wants me to personally guarantee that loan with my savings, my house, my car, etc?
laid off employee says,
take your personal savings from the 'boom times', put it at risk, and burn through it to keep your household running for the next 6 months when your spouse is earning less than half of the household income. don't like it coming out of your pocket directly? well, try to put it all on a credit card (if you can these days). what? the bank wants me to personally guarantee that loan with my savings, my house, my car, etc?
it cuts both ways, and no one has it easy these days.
The senate compromise with the minority (possibly out of touch) republicans has cut all $16B for school construction and $26B for the education slush fund, and cut in half the funds to make federal buildings more energy efficient
If the litigation surrounding Al Franken’s Senate win in Minnesota is resolved this week then the Democrats will have 60 senators and could steam roll things over the republicans, who still think the market will correct itself without any government intervention apart from more tax cuts.
Even the few remaining republican governors are up in arms about the “moral stand” the republicans are taking and their obstructionist policy.
After all of this will there bee any republican architects left? It seems that, at the moment, the republicans are working against our best interest.
As for those of us struggling in the economic crap storm I think we need to bear in mind that over a 10 year period we will not make more than teachers, often I have witnessed my fellow young and aspiring architects trying to live the lifestyle of their clients and that is simply not possible. You can not shop at design with reach and for that mater Ikea. It is the thrift store for all your furniture needs. But young architects should not have too many furniture needs since they should be living in tiny rented studios in the not so nice parts of town. The American dream can not be financed on an intern’s salary alone.
Once I am gainfully employed again I intend to spend as little as possible and try to save two years of salary. I imagine that this recovery will be slow for the private sector which is why I am disappointed that the needed construction funding has been lost in this stimulus bill.
I can only imagine how this economic stress is impacting architects that are married and or have families. Does the AIA keep stats on divorce rates for professionals in our field?
Question for the firm owners out there, will you change your view or position towards interns and junior staff who keep a 2nd job. One firm I worked at pressured a fellow intern to quit her 2nd job and she eventually did, do you think this will change given the situation that we are collectively experiencing? Also does it depend on the 2nd job?
I think it is sad that people think the only way they can operate is by the same old methods. I am an architect so we only do architecture and when times are lean I fire people I have spent years to foster. silly.
What I would do, and am in the process of doing, is starting an "ideas" company as an umbrella company around many different creative fields. I have a background in web development, graphic design, interactive media, etc. to go along with all of the architecture knowledge. If one is innovative their should be opportunities for public funding of non-for profit work coming soon and a company could realign itself to take advantage of those opportunities as well. Not to mention using a break in work to focus on internal design issues and publish, patent, model, and produce production ideas, if not products, in a range of commercial industrial, interior, and architectural design applications.
A company is only limited by its on vision of what is possible. The future is not one of isolated fields - quite the opposite, opportunities will arrise through the relationships of disparate fields.
: "... people think the only way they can operate is by the same old methods. I am an architect so we only do architecture and when times are lean I fire people I have spent years to foster. silly."
an interesting point of view, to be sure. while I would agree that a certain flexibility in how one approaches one's business is appropriate and desirable, there's also the concept of "focus" ... and the ability of focus to make one truly "expert" at what one does.
there is a long-standing trend in the profession towards specialization ... while many of us like to think of ourselves as "generalists" the reality is that most of the marketplace looks to us to be highly expert in a fairly narrow aspect of the profession. the client wants to know that we've solved his problem tens - if not hundreds - of times before. clients generally are not about taking on much risk and they really don't want to pay us to learn on their nickel.
this trend flies in the face of how most of us were educated and, quite frankly, how most of us think about ourselves. we tend to think we can design anything ... we can ... it's just that most of us can't design everything well. the marketplace knows this and imposes this discipline on us because we rarely want to impose it on ourselves.
when the market shifts ... as it has in recent months ... firms of any significant size find it difficult, and costly, to shift instantaneously to a new line of business. it takes time, it takes a lot of money and marketing effort, and it sometimes requires a new group of people with a new set of skills. during the 'retooling' period, firms often have a surplus of talent that they don't have the economic strength to support. this is harsh news ... but it represents a harsh reality. firms of some size simply do not -- and cannot -- reinvent themselves overnight.
I appreciate the passion you exude in your post above and I'm truly not trying to burst your bubble. I wish you well. I just advise caution ... in today's economy, firms that try to be the proverbial "all things to all people" are up against a truly tough reality.
I can't think of any architect-principal, even at the large firms, driving a Ferrari-level expensive car. The fanciest car I can recall is Adrian Smith's sports car, but that was in the early 90s during the Bishopsgate/Canary Wharf boom. I don't begrudge anyone their five-year old BMW. You can buy a used E300 Mercedes for the cost of a domestic SUV; architects just have better taste and sometimes an extraordinarily thrifty skill of finding "high-end" at "beer budget".
A number of the Chicago developers, particularly the REITs, industrial sector, design build office/industrial sector, and high-rise residential sector (not naming names) already have had significant lay-offs.
Last Chicago developer still hiring appears to be John Buck, for Abu Dhabi postings for multi-year employment contracts for construction supervision-related assignments for an ongoing development project by its new Abu Dhabi partner. Going to Middle East to supervise construction is a drastic change in life-style and and work-habits, and not a good choice for families with school-age kids. Actual third-world construction workers (trades are selected from specific countries) are treated harshly, like indentured servants with poor labor conditions, makeshift housing, and few legal rights. Middle-management Americans have better conditions, but are significantly restricted as well, in an extremely expensive housing market, limited social life, and legal restrictions against unmarried cohabitation, unmarried mothers, etc.
School teachers my age (in 50s) out-earn Chicago-market "associate partner"-level architects of my age. But the teachers have the additional benefit of pensions, which will generously pay a living-wage retirement income. Architects here are lucky if the firm has a diminished 401K plan, controlled by weak financial investment houses (how safe is my Merrill Lynch account anyways, even if it's in "safety of principal?), and the specter of a frugal retirement. My suburban house was my retirement fund, and now between the extremely high North Shore taxes (school age kids) and diminished market/resale value, that seems pole-axed as well.
I know architects in their 50s, living from paycheck to paycheck with a small "rainy-day" fund, with kids. An architect is lucky if he/she has a spouse with an income not drawn from an architecture firm, that provides both a higher standard of living, better benefits, and more job-security. But now, even the construction and development firms are slow, and laying off people, so the spouse working in those fields is as precariously placed as an architect.
Architecture is a profession for the independently wealthy, with a large income source tied to family money. So long as that money wasn't invested w/Madoff...
It's equally as rough to be an employer, as difficult to be the person who has to let people go *even as they are worried about their own job*, as being an employee who is facing layoffs. To be honest, I would rather be the person on the end of having to be let go than the person who day in and day out has to think about how to keep people or who to cut...
But there is something else for firms... Letting people go can be costly for firms, maybe necessary, but it's extremely costly too: it's selling low... It's like the stock market. Ideally if you could, you would always buy in when it is low... You invest in people (like stocks) and letting go of people is like selling when the price is down... It's costly to let people go (severence) and costly to hire (hiring costs)... Is there a way to mobilize the people you have to improve your firm to make you more competitive and adaptive to a down market? So that when your firm sees an "up market" you are positioned to take the market by storm?
Regarding firms that are faced with letting go their "investments", good people: is there a way to invest in the future? How do you put people to work to build on your company even when project work is slim so that when the economy picks up, you are in a better position to capitalize on iit? How do companies "buy in" to a depressed market? How do you not be the firm that invested in the market when the market was down? Because when the market rebounds, everybody will be "buying in" (hiring in) and it will be too late for the firm that was only looking to hold onto its cash to capitalize on what is really an employers market, they will be left in the dust...
Well it's not an "employers market" in the sense that people can afford to hire people, it's very risky, but the fact is, there is top talent out there right now...
Because lets face it: as bad as this is for architects who might get laid off, or watch our friends laid off, and wait for our turn to get laid off, it's even *worse for the firm*... It's their loss as much or more so than *ours*. The market may recover, but that doesn't mean that employees will come back... Many people who are being let go now, may not even be working in this industry when it comes back, they may go to other career directions, working for other parts of the industry or other industries all together...
Firms have a tough decision because in letting go of workforce, they are effectively "shrinking their offices" to cut costs, reducing their workforce and skillsets in order to make ends meet, which makes them less profitable in the long run and they are selling off their investments, their talent pool. They need good people as much as good people need work. What's more, there are things which you can't buy: team dynamics, trust, and workplace comradery that suffers and cannot be rebuilt easily. It's much more difficult to build a strong and loyal and effective workforce than it is to get a new job... I would rather be an employee than an employer in times like this... If I get laid off, I can start something new, look for a new job... But firm management has the unfortunate challenge of maintaining workplace morale and not burning bridges with talent they let walk out the door(and friends they've worked with for years), as much as employees have an interest in maintaining good relationships with firms... It's more stressful the more people you are managing IMHO... They're responsible for us too, I would not want to be the one having to make those kinds of decisions at a time like this...
I mean: I look at the amazing friends and talents I know who have been let go in this downturn and I can't help but think that if they all came together and the market had bottomed out and was on the upswing and projects were coming in, people were looking for architects... If all those people came together and started their own practice, they could very easily outperform some of their old employers... That's more competition...
i am an architect and a libertarian republican and do not believe in the statist approach being taken to our economic mess. let's not get into democrat vs. republican as the roots of the crisis can be traced back to carter and clinton era efforts to make mortgage available to anybody and everybody. 'nuff said.
the unique aspect of the recession is how fast companies are shedding jobs. the only industries growing are education, health care, and government. you can read this almost anywhere online. common thread of the three is they all depend on your tax dollars. and, they will grow more in the coming year or two.
cars: i know numerous principals who drive jaguars, porsches (i know one with four), mercedes (know one with two $100K+ sports coupes), and assorted bimmers. if you are a principal, it is a company car and a write-off. there are many principals who do well and clients like to do business with someone who looks successful. i drive an audi a6.
myself: work for a firm with four partners - two senior, two junior - of which two preoccupy themselves with teaching. the two junior partners 'bought' into the firm. under them are three senior staff - one technical (myself), two design. we are in the san francisco bay area and under 60 persons. we have lost 8 mostly junior staff in the past 6 months. termination of employees is above my pay-grade. we do not have a specialty and have a well-rounded practice divided between private and public sectors. our design work is excellent and cds much better than most. fortunately, we have been able to weather the current storm so far. private sector projects have dwindled and become smaller in scope - lower fees! there is still work but, different than we would like. we are on top of almost every appropriate public sector project nearby and have great relationships with cities and counties. depending on availability of funding (sales of most bonds are through the state and no one is buying state bonds), we will get our share. our work load for the next 6 to 9 months is stable. our crystal ball goes blank after that. there is no doubt we will have work.
my future: been here for almost ten years and helped the firm grow from little more than two guys in a garage. brought in work too. been a mentor and almost a father to many young architects. had opportunity to buy in and declined. need to relocate and be nearer to family and property we own back east. job offers have come my way regularly for many years and, much to my surprise, the number of contacts by recruiters and larger firms has increased over the past year. as some have noted, firms are acquiring top talent to firm up their core practices. there is also keen interest from construction management firms. unless you are a top niche designer (friend does hotel interiors and he is booked solid for the next two years) public sector work may be the best way to ride this out. otherwise, look to smaller, and very smaller, firms for work. they are the most flexible and have the strongest survival instincts.
stimulus package: congress might as well give $9000 to every man, woman, and child in america, illegals included. the money gets spent or parked somewhere where it will be used. money does not just sit; it gets used and creates more value. news reports indicate effects from the currently designed stimulus package will not kick in until 2009 and 2010 with little of it actually stimulating anything, except government. think waste, fraud, and abuse. the benefit, if anything, is getting cash into the markets and onto the streets. people have to buy things, build things, invest in things. money needs to flow and move around and hopefully not overseas. the downside is devaluation of the dollar. in the short term this is okay as every currency is being devalued. for the long term let's hope other currencies revalue much stronger than they were a year ago. if you have the ability, it is a good time to invest in gold.
definitions of 'shovel-ready' abound. every little hamlet, town, and city has their own definition and are lining up at the mother pig. as a profession, we'll eventually get ours. at what price? likely, the recession//depression will have already runs its course.
during the late 1970s and early 1980s some associates did the following, in no particular order.:
*established an artisan ceramic tile business.
*relocated to canada and eventually became an executive with volkswagen.
*became a mfrs. rep for acoustic tile. he became the senior marketing person for one of the top five general contractors in america.
*became a solar energy consultant. carter gave away tax money for folks to install panels on their roofs. he eventually became a daylighting consultant and wrote a book or two.
*did surveys of historical structures under contract to smithsonian.
*learned arabic and moved to saudi. think he now teaches at tulane.
*regional construction manager for dunkin donuts. back into architecture as economy turned.
*project manager for frito-lay (potato chips, etc.)
*in-house architect for major retail chain with shops in every mall in america.
*bought crack houses and became a slum lord. he is now a member of the city council of a large midwest city.
*thought it a good time to have kids.
most stayed in architecture. several are now principals at prominent name firms.
i did not wish to leave the impression my comments were sexist. there were far fewer women in architecture then and wish to share what some i know did during this time.
*became vp of major banking organization as expansion of branch banking too off.
*went back to law school. relocated to puerto rico.
*pro bono work for community groups. now is in charge of construction for a large community college district.
*established small practice.
I think any direct tax rebates, which have been proposed, will not be spent on goods and services but instead be spent on debt obligations. 9k probably won’t keep people from losing their homes. Government spending on useful projects no mater how fast or slowly they are implemented I think is the best answer. New transit systems roads and bridges can take a while to plan before construction begins, but jobs can be saved or created right away even if the project has a long payout period.
It seems that this downturn, recession, or depression were in will have some long lasting effects on the way people consume and regard personal debt. The American Dream needs to be downsized as well. No more 2,000 sf 4 br 3-1/2 bath 3 car garage homes for every one. Things will and need to change. The notion people carry that they are entitled to a big house in a safe neighborhood with decent schools a separate car for their kids when they turn 16 is rubbish. Priorities will shift and a long slow recovery is what we face as people try to limit their debt liabilities and try to save more.
Tax cuts don’t do much to close the income/ wealth gap, but good jobs and living wages do. Big business is not obligated to spend any of the tax cuts or rebates they get, it is a gamble and I think we had enough gambling on Wall Street.
whether spent on a car, house addition, clothing, new haircut or debt obligation, the money goes somewhere, and eventually in and out of some financial institution. it is money being put into circulation and this seems what is needed immediately. government believes the money is best spent on infrastructure, honey bee insurance, or a mob museum. the process is slower and empowers this administrations little piglets.
thought of what a few other former associates did back then.
*mba and into real estate.
*went back to peru.
*automobile restoration (turned a hobby into a business)
*sold cars - not applicable today unless its a hyundai or bimmer.
*went to work for his father. think he owned a car repair shop.
*honey bee insurance is a portion of a disaster relief program for livestock producers. so, its your feeling (or is it fox news' feeling for you) that if honey producers or small businesses who rent their bees to pollinate crops suffer colony collapse that its their tough luck...
insurance against honey bee colony collapse should be paid by those in the honey business. collapse of colonies for honey bees nationwide it is a larger problem requiring investment in scientific research to learn why. just giving honey makers money to cover their losses is not right. btw, what were people planting before they availed themselves of honey bee colonizers?
am not into fox, cnn, abc, nbc, or cbs. make my own decisions. fox is running away with the ratings so they must either be doing something right or spot on with their coverage.
Layoffs....layoffs......
Wrong on some counts, chupacabra.
Cobra payments are made by the employee, not the employer, so there is not cost to the employer.
If you cut someone's pay, you still have to pay for their health insurance, or whatever part of that you normally pay .
Your workers comp charge does not really go up until about a year after layoff occurrences.
Most firms now are looking at short term costs. Yes, it costs something to lose a good person, there is the training, etc., but short term, you save much more getting rid of a person and all of the payroll and benefits than cutting other peoples wages and hours. Of course, if owners can get away with wage cuts and keeping everyone full time, they are then ahead.
Studying and filing and other non-billable time consumption may be tolerated for several weeks, but a firm needs to cut non-billable personnel quickly if it will survive these economic times. Many architectural firms (almost always the small firms, but also some mid to larger firms) don't have the cash reserves to "float" the staff for months on end. Often the principal(s) have taken out short-term loans, using their unpaid invoices as collateral, to cover payroll during cash shortages.
But note that many firms now have uncollectable invoices accruing, because a developer who isn't proceeding with his project, who doesn't have a construction loan, is also a client not paying his bills. Witness the large liens placed by Perkins & Will on the Spire and other projects. But you can't collect on a lien until the owner sells his property; the lien just sits there.
Lay-offs are terrible. But sometimes lay-offs are the only action available to a firm, even the large firms. Even a substantial salary cut for a SOM principal might save only a handful of positions for several months; don't kid yourself.
Update: Callison has laid off more employees in Seattle and New York already this month. Rumor on the street is that they, through continued terminations/layoffs will be at 400 (down 50%) by spring. The private equity firm that bought into the company is controlling the strings I'm told. Callison, which has a long standing reputation for standing by it's people has caved to the desires of their new owners. Friends who work there and who used to work there said it isn't the place it used to be in the past years. It's panic in the streets folks.
Callison was up to 800? That does not bode well for the Seattle area.
where you come down on this issue is, I think, very much a function of the firm in question and its culture. some firms actually do have an "one for all / all for one" culture and the idea of pain-sharing to keep the core team together actually works and strengthens the firm's culture even further.
nevertheless, it's rarely (if ever) a democratic process or decision ... the owners of the firm generally approach decisions of this nature with a view toward what's in the strategic, long-term best interests of the company.
at any rate, our firm is about to find out -- we've had all the layoffs we think we can afford without cutting deeply into real muscle -- if we have to reduce payroll further (a day-to-day thing, due to funky cash flow) we'll probably go to a reduced workweek, with commensurate pay cuts all around. we will, however, continue to provide full medical benefits.
another reason this country needs a revamp in healthcare. why it is tied to an employer is recockulous.
If you want to save your jobs: This is on the Senate floor today!
Contact Your Senator's Today and let them know your against Lieverman on this one.
Senator Lieberman is negotiating at the Senate level to deplete 2/3 of the allocated spending for green federal buildings across the country, thus reducing a $6 million allocation to $2 million. This dramatically impacts the design and construction industry in a negative way.
Lieberman is an idiot. I sent a note to both Senator Webb and Senator Warner about the stimulus and the importance of infastructure, energy effiency and mass transit and their importance to the design and construction community.
Lieberman is a right wing nut job who only won the senate race because the republican candidate was indicted on corruption charges a few weeks before the election and got less than 6% of the vote.
I hope Connecticut voters recall that idiot and then drive him out of the state and out of the US
babs - you're right in that firm culture plays a huge part in that kind of decision. my main point was the time duration involved - if it's short term, i think almost everyone would be down with taking a reduction to keep the team intact. what would be more difficult is, if the time length was indeterminable, would people do that? i'm not so sure people would take 20% cuts for a year if the alternative was to fire 1/5 of the staff that obviously could be done without.
: yes, well ... length of time anticipated is a material factor when deciding between paycuts and layoffs ... thanks for that clarifying observation ... the hard part is really knowing how long the economic difficulties will last ... crystal balls being the imperfect instruments they are, it's not always easy to tell at the beginning what the duration is likely to be ... our firm believes the duration will be fairly short ... if we're wrong, then further layoffs may need to happen ... we think a reduced work week would be an appropriate strategy for us until the picture clears.
maybe you will be able to set up some informational interviews with potential employers if you go belly up...
vado ... if you're not interested in making thoughtful, constructive contributions to the discussion, why do you bother to post?
Well that advice seems to be fine for you to give. Why is it not a thoughtful or constructive comment when i propose that you may want to think about setting something up? You never know. This economy may not pick up for some time? How many cuts can you make before you make it to your own throat? You really don't want to get to far into my dish.
In addition, this is a thread about being laid off. If you want to comment upon a firm's rationale for laying people off and the sacrfices that must be made to keep your little mom and pop enterprise afloat then by all means create a topic about it. But the fact is most people who have been given the pink slip don't really give a rats ass about what you must endure as a firm owner. Their pain isn't resolved or lessened by your comments; which are neither thoughtful nor constructive.
I picture vado with a *tight* beret - constantly - and would have him no other way.
I actually agree with Vado.
The only thing a guy like me gives a rats ass about is my employment and being able to hang onto my employment. We don't really give a flying fuck about of your excuses (whether they're justified or not) as to why you need to let people go. We've heard them all before and it's the same tire, worn-out, 1950s mentality rubbish that has been tried over and over and over.
At one of my friend's last firm, he was one of many who were rounded up in a group like cattle and was told of the "situation." He just walked out of the room as soon as the principal said they were being laid off. Does anyone really need to listen to the ensuing horseshit after being told THAT news?
Archmed,
No one wants to be laid off, and no one wants to lay off employees. You can not give a rats ass, but you should at least want to understand things from your employers viewpoint for so many reasons:
- If you understand what makes an employer keep on employee and ditch another, you have a better chance of staying employed.
- someone who only has an employee mentality will not go very far, and is probably one of the first people laid off. If I am going to go into debt and take out a loan, go without any salary at all, and remortgage my house to keep you employed while I have no work for your to do, I better be damn sure you will return the loyalty and stick around when the pendulum swings back and firms are hiring again. But someone with the rats ass philosophy of life probably would not be work the risk on my part.
- If you understand the employers viewpoint, perhaps you can head off being laid off completely by volunteering to work part time, or take a pay cut, if this works for you.
- If you understand the employers viewpoint, chances are you will be one of the ones hired back first when things pick up, instead of the bitter person who lets their tight beret make them unemployable in a firm.
- you might be an owner of a firm someday you know.
"- you might be an owner of a firm someday you know. "
Office RA.
You know what it stands for. Let the client decode the binary acronym as they see fit and just say 'yep!'
understand the owners viewpoint. that when their little Donner party of a business gets caught in the pass, that your ass will be served up first.
I always envisioned...Periodbritches with a cape codish look you know topsiders, ponytail, and a wicked accent! Now I better get back to work before I get tossed out of my own architecture office.
Don't lay yourself off today snook. You'll ruin your weekend.
Archie, archie, archie, you're doing it too. We've already heard all of this millions and millions of times and it gets so repetitive, so asinine, and sooooooo tired -- It's like like people never really got over the 1950s business model and continue rehashing the same nightmare again and again. You will tell us about how "difficult" it is for you to make these decisions and then herd about 50 people into a room and categorically toss them onto the streets like rubbish while shedding a few crocodile tears. You don't think we've experienced this before?
In the end of the day you're still sitting pretty high atop your perch at XYZ Design with the profits you received in the boom times of 2004-2007. In the meantime, we're all out on the streets begging, heaping, and groveling for one of your little "informational interviews." And those of us who were fortunate to last through your third round of layoffs will sacrifice just about everything we have left (including our dignity and pride) to do as much work as possible and do whatever we can to keep our already unsatisfactory pay and pray every day that you don't either reduce our salary or flat out toss us onto the street like a the vermin we are. We're the ones losing sleep and having nightmares about the specific nature of how you plan on delivering the "great news" to us. We already understand all of this. Do you really think we need to be hearing these fucking lame excuses here too?
I know you hate to hear this but this is just how we feel. There are a lot of firms out there and a lot of firms do things differently. And in many cases you and many like you will look like the villains. Whether or not you're directly responsible, as a person in the upper management of a tanking firm, people will look at you and your actions in contributing to the downfall while having to categorically destroy ones livelihood.
Vado.....If I lay myself off there is no one to finish up all my projects....and that would piss alot of people off. So think I will
go get laid instood.....and come back on Monday and worry about the economy.
i am not necessarily a fan of anybody but i don't see anything wrong with bab's, archies or the others' posts about how the other side (actually in most cases, we as architects, are all on the same side, just different levels) go through the economic downturns. they don't deserve this angst.
let's say you have 10 employees, a relatively small firm. each costs 7k a month. how would you go to sleep thinking you have to come up with 70k at the end of the month when you have been borrowing heavily the last few months to keep everybody employed. it adds up in a speed of light and if you don't take action, you have lost everything.
how i wish, for years, to have a regular job and receive a paycheck like everybodyelse and go home and make monthly financial plans etc...
or, go out and get a decent camera instead of my 4 mp one i have been using for many pictures here and in my blog. but i still take good pictures with my cheap camera and it doesn't stop me taking pictures.
"waiting for nothing," it is a great phrase and great book written during the depression years.
stop blaming others. i don't want to feel sorry for you. not because you might lose your job but you let your fear and anger take over and might misjudge people. these are the same people you'll be knocking their door when the economy is better. they will hire you to be a part of the project they got. you might have your own business by then but there will be others who will want that job. as an architect you are a little bit more advantageous than an auto worker in terms of picking your employer.
yes there are a lot of owners out there who are greedy and will drive a late model ferrari while your transmission needs immediate work, but there are also many who just want to enterprise running so everybody has a job and paycheck to feed their families.
archmed, you are painting the employers like bunch of vampires. why have you been near these people all this time?
go out and be a starving artist like some of us. we don't have guaranteed meal or health insurance but we also don't have anybody breathing on our back either. find out which fits your personality and philosophy best. it is not the end of the world. maybe you learn to be independent of these people along the way. stop the fear killing the soul.
if you are going to do the talk, do the walk. start organizing your fellow workers and take action, if any.
In all seriousness I agree with Orahn. Who knows who will ride out this turmoil, but as a tiny small practice. Others are starting to understand a bit what it is like. I hate it when I have to upgrade equipment, I hate it when I have to lay out money for insurance, but we do it. We work long hard days and nights if we have to.
We are fortunate in we do have a nice blend of work some low end residential some high end residential, some school work, some industrial and some bank work. We are small, we work smart and quick, we keep the client first and always always try to keep the project on budget. We are always respectful of contractors.
I think this is the reason I have yet another project contract signing on Monday, when people are saying nothing is happening.
A time will come when this is behind us and we will be grateful for our many blessings, like good health, loving dogs, and Spring Grass!
Amen, Orhan!
:" We don't really give a flying fuck about of your excuses (whether they're justified or not) as to why you need to let people go. "
The corollary to that narrow view is a firm not really giving a 'flying fuck' about your continued employment when faced with a huge payroll and rapidly declining revenues.
If you're not remotely empathetic to the environment in which you work then you deserve what happens to you. Firms understand which employees "get it" and which don't. They tend to bet on those who do.
archmed - how many firms have you worked for in your career?
I've been through several rounds of layoffs at various firms... some offices are better at clueing in their staff to what is happening than others... People aren't as pissed off at what is happening if upper management explains what's going on with the business. yes, some principals are assholes who don't care about their staff... but most do care - they made the investment in finding good people, and it's extremely hard for them to let anyone go... but if they are bad about communication, then people are going to think they don't care even if they do.
archmed - i think most of us can empathize with your obvious anger and insecurity in this market environment. however, you are absolutely clueless as to how firms run.
try this (as orhan, i, and others have outlined): take your personally savings from the 'boom times', put it at risk, and burn through it to keep all of the 'underpaid' staff you have employed for the next 6 months. when there is simply about half the income you need to make the office work. don't like it coming out of your pocket directly? well, try to get a line of credit established (if you can these days). what? the bank wants me to personally guarantee that loan with my savings, my house, my car, etc?
point is - most of what's happening in this economy is beyond anyone's control. entire market segments just disappeared overnight - blame the bankers, investment managers, and whoever created the credit default option if you must. i don't know of anyone who wouldn't rather be in a mild slowdown, but know they have 2 years of backlog on the books. it's just not the case and it's not because of poor management alone.
: "We're all victims of someone else's mistake. We've done nothing wrong here."
I really see little point in expressing sentiments of this nature - it's almost like there's class warfare going on. Such sentiments - while perhaps stress relieving - are, in my view, unhelpful.
The simple fact is that the markets in which architects operate are volatile and cyclical. They don't really teach that idea very much in school. but any of the old hands here know it to be true and unchangeable.
For many very good reasons, firms don't (can't) keep a lot of money in the firm to support down periods - these reasons are mostly tax related. When the market shifts, payroll - particularly underutilized payroll - becomes a huge burden to the firm's viability.
Nobody within the profession - neither firms nor employees - have necessarily 'done anything wrong' here. Firms staffed up in the past few years because the work expanded - this created employment. When the market turned - suddenly and unexpectedly - firms found the level of staffing they were carrying to be unsustainable.
Layoffs are painful and costly and regrettable on both sides. But, the simple fact is that underutilized labor is extraordinarily expensive and unsustainable by any firm for very long.
I recognize the temptation to demonize "the firm" when layoffs take place. With greater maturity you may come to realize that most firms already carry unneeded labor much longer - and make financial sacrifices much larger - than is really healthy for the firm's financial strength.
These are lamentable times. But, the demons aren't necessarily to be found within the profession.
owner says,
take your personally savings from the 'boom times', put it at risk, and burn through it to keep all of the 'underpaid' staff you have employed for the next 6 months. when there is simply about half the income you need to make the office work. don't like it coming out of your pocket directly? well, try to get a line of credit established (if you can these days). what? the bank wants me to personally guarantee that loan with my savings, my house, my car, etc?
laid off employee says,
take your personal savings from the 'boom times', put it at risk, and burn through it to keep your household running for the next 6 months when your spouse is earning less than half of the household income. don't like it coming out of your pocket directly? well, try to put it all on a credit card (if you can these days). what? the bank wants me to personally guarantee that loan with my savings, my house, my car, etc?
it cuts both ways, and no one has it easy these days.
The senate compromise with the minority (possibly out of touch) republicans has cut all $16B for school construction and $26B for the education slush fund, and cut in half the funds to make federal buildings more energy efficient
If the litigation surrounding Al Franken’s Senate win in Minnesota is resolved this week then the Democrats will have 60 senators and could steam roll things over the republicans, who still think the market will correct itself without any government intervention apart from more tax cuts.
Even the few remaining republican governors are up in arms about the “moral stand” the republicans are taking and their obstructionist policy.
After all of this will there bee any republican architects left? It seems that, at the moment, the republicans are working against our best interest.
As for those of us struggling in the economic crap storm I think we need to bear in mind that over a 10 year period we will not make more than teachers, often I have witnessed my fellow young and aspiring architects trying to live the lifestyle of their clients and that is simply not possible. You can not shop at design with reach and for that mater Ikea. It is the thrift store for all your furniture needs. But young architects should not have too many furniture needs since they should be living in tiny rented studios in the not so nice parts of town. The American dream can not be financed on an intern’s salary alone.
Once I am gainfully employed again I intend to spend as little as possible and try to save two years of salary. I imagine that this recovery will be slow for the private sector which is why I am disappointed that the needed construction funding has been lost in this stimulus bill.
I can only imagine how this economic stress is impacting architects that are married and or have families. Does the AIA keep stats on divorce rates for professionals in our field?
Question for the firm owners out there, will you change your view or position towards interns and junior staff who keep a 2nd job. One firm I worked at pressured a fellow intern to quit her 2nd job and she eventually did, do you think this will change given the situation that we are collectively experiencing? Also does it depend on the 2nd job?
I think it is sad that people think the only way they can operate is by the same old methods. I am an architect so we only do architecture and when times are lean I fire people I have spent years to foster. silly.
What I would do, and am in the process of doing, is starting an "ideas" company as an umbrella company around many different creative fields. I have a background in web development, graphic design, interactive media, etc. to go along with all of the architecture knowledge. If one is innovative their should be opportunities for public funding of non-for profit work coming soon and a company could realign itself to take advantage of those opportunities as well. Not to mention using a break in work to focus on internal design issues and publish, patent, model, and produce production ideas, if not products, in a range of commercial industrial, interior, and architectural design applications.
A company is only limited by its on vision of what is possible. The future is not one of isolated fields - quite the opposite, opportunities will arrise through the relationships of disparate fields.
there should, not their...oh please make an edit button archinect gods.
amen on that eidt button...
: "... people think the only way they can operate is by the same old methods. I am an architect so we only do architecture and when times are lean I fire people I have spent years to foster. silly."
an interesting point of view, to be sure. while I would agree that a certain flexibility in how one approaches one's business is appropriate and desirable, there's also the concept of "focus" ... and the ability of focus to make one truly "expert" at what one does.
there is a long-standing trend in the profession towards specialization ... while many of us like to think of ourselves as "generalists" the reality is that most of the marketplace looks to us to be highly expert in a fairly narrow aspect of the profession. the client wants to know that we've solved his problem tens - if not hundreds - of times before. clients generally are not about taking on much risk and they really don't want to pay us to learn on their nickel.
this trend flies in the face of how most of us were educated and, quite frankly, how most of us think about ourselves. we tend to think we can design anything ... we can ... it's just that most of us can't design everything well. the marketplace knows this and imposes this discipline on us because we rarely want to impose it on ourselves.
when the market shifts ... as it has in recent months ... firms of any significant size find it difficult, and costly, to shift instantaneously to a new line of business. it takes time, it takes a lot of money and marketing effort, and it sometimes requires a new group of people with a new set of skills. during the 'retooling' period, firms often have a surplus of talent that they don't have the economic strength to support. this is harsh news ... but it represents a harsh reality. firms of some size simply do not -- and cannot -- reinvent themselves overnight.
I appreciate the passion you exude in your post above and I'm truly not trying to burst your bubble. I wish you well. I just advise caution ... in today's economy, firms that try to be the proverbial "all things to all people" are up against a truly tough reality.
best wishes.
I can only speak of Chicago market.
I can't think of any architect-principal, even at the large firms, driving a Ferrari-level expensive car. The fanciest car I can recall is Adrian Smith's sports car, but that was in the early 90s during the Bishopsgate/Canary Wharf boom. I don't begrudge anyone their five-year old BMW. You can buy a used E300 Mercedes for the cost of a domestic SUV; architects just have better taste and sometimes an extraordinarily thrifty skill of finding "high-end" at "beer budget".
A number of the Chicago developers, particularly the REITs, industrial sector, design build office/industrial sector, and high-rise residential sector (not naming names) already have had significant lay-offs.
Last Chicago developer still hiring appears to be John Buck, for Abu Dhabi postings for multi-year employment contracts for construction supervision-related assignments for an ongoing development project by its new Abu Dhabi partner. Going to Middle East to supervise construction is a drastic change in life-style and and work-habits, and not a good choice for families with school-age kids. Actual third-world construction workers (trades are selected from specific countries) are treated harshly, like indentured servants with poor labor conditions, makeshift housing, and few legal rights. Middle-management Americans have better conditions, but are significantly restricted as well, in an extremely expensive housing market, limited social life, and legal restrictions against unmarried cohabitation, unmarried mothers, etc.
School teachers my age (in 50s) out-earn Chicago-market "associate partner"-level architects of my age. But the teachers have the additional benefit of pensions, which will generously pay a living-wage retirement income. Architects here are lucky if the firm has a diminished 401K plan, controlled by weak financial investment houses (how safe is my Merrill Lynch account anyways, even if it's in "safety of principal?), and the specter of a frugal retirement. My suburban house was my retirement fund, and now between the extremely high North Shore taxes (school age kids) and diminished market/resale value, that seems pole-axed as well.
I know architects in their 50s, living from paycheck to paycheck with a small "rainy-day" fund, with kids. An architect is lucky if he/she has a spouse with an income not drawn from an architecture firm, that provides both a higher standard of living, better benefits, and more job-security. But now, even the construction and development firms are slow, and laying off people, so the spouse working in those fields is as precariously placed as an architect.
Architecture is a profession for the independently wealthy, with a large income source tied to family money. So long as that money wasn't invested w/Madoff...
Times are rough...
It's equally as rough to be an employer, as difficult to be the person who has to let people go *even as they are worried about their own job*, as being an employee who is facing layoffs. To be honest, I would rather be the person on the end of having to be let go than the person who day in and day out has to think about how to keep people or who to cut...
But there is something else for firms... Letting people go can be costly for firms, maybe necessary, but it's extremely costly too: it's selling low... It's like the stock market. Ideally if you could, you would always buy in when it is low... You invest in people (like stocks) and letting go of people is like selling when the price is down... It's costly to let people go (severence) and costly to hire (hiring costs)... Is there a way to mobilize the people you have to improve your firm to make you more competitive and adaptive to a down market? So that when your firm sees an "up market" you are positioned to take the market by storm?
Regarding firms that are faced with letting go their "investments", good people: is there a way to invest in the future? How do you put people to work to build on your company even when project work is slim so that when the economy picks up, you are in a better position to capitalize on iit? How do companies "buy in" to a depressed market? How do you not be the firm that invested in the market when the market was down? Because when the market rebounds, everybody will be "buying in" (hiring in) and it will be too late for the firm that was only looking to hold onto its cash to capitalize on what is really an employers market, they will be left in the dust...
Well it's not an "employers market" in the sense that people can afford to hire people, it's very risky, but the fact is, there is top talent out there right now...
Because lets face it: as bad as this is for architects who might get laid off, or watch our friends laid off, and wait for our turn to get laid off, it's even *worse for the firm*... It's their loss as much or more so than *ours*. The market may recover, but that doesn't mean that employees will come back... Many people who are being let go now, may not even be working in this industry when it comes back, they may go to other career directions, working for other parts of the industry or other industries all together...
Firms have a tough decision because in letting go of workforce, they are effectively "shrinking their offices" to cut costs, reducing their workforce and skillsets in order to make ends meet, which makes them less profitable in the long run and they are selling off their investments, their talent pool. They need good people as much as good people need work. What's more, there are things which you can't buy: team dynamics, trust, and workplace comradery that suffers and cannot be rebuilt easily. It's much more difficult to build a strong and loyal and effective workforce than it is to get a new job... I would rather be an employee than an employer in times like this... If I get laid off, I can start something new, look for a new job... But firm management has the unfortunate challenge of maintaining workplace morale and not burning bridges with talent they let walk out the door(and friends they've worked with for years), as much as employees have an interest in maintaining good relationships with firms... It's more stressful the more people you are managing IMHO... They're responsible for us too, I would not want to be the one having to make those kinds of decisions at a time like this...
Hopefully things pick up soon...
rereading that... I meant to say: how do you be the firm that "bought in" when the market bottomed out...
I mean: I look at the amazing friends and talents I know who have been let go in this downturn and I can't help but think that if they all came together and the market had bottomed out and was on the upswing and projects were coming in, people were looking for architects... If all those people came together and started their own practice, they could very easily outperform some of their old employers... That's more competition...
brink was drunk before 6.
awesome!
i am an architect and a libertarian republican and do not believe in the statist approach being taken to our economic mess. let's not get into democrat vs. republican as the roots of the crisis can be traced back to carter and clinton era efforts to make mortgage available to anybody and everybody. 'nuff said.
the unique aspect of the recession is how fast companies are shedding jobs. the only industries growing are education, health care, and government. you can read this almost anywhere online. common thread of the three is they all depend on your tax dollars. and, they will grow more in the coming year or two.
cars: i know numerous principals who drive jaguars, porsches (i know one with four), mercedes (know one with two $100K+ sports coupes), and assorted bimmers. if you are a principal, it is a company car and a write-off. there are many principals who do well and clients like to do business with someone who looks successful. i drive an audi a6.
myself: work for a firm with four partners - two senior, two junior - of which two preoccupy themselves with teaching. the two junior partners 'bought' into the firm. under them are three senior staff - one technical (myself), two design. we are in the san francisco bay area and under 60 persons. we have lost 8 mostly junior staff in the past 6 months. termination of employees is above my pay-grade. we do not have a specialty and have a well-rounded practice divided between private and public sectors. our design work is excellent and cds much better than most. fortunately, we have been able to weather the current storm so far. private sector projects have dwindled and become smaller in scope - lower fees! there is still work but, different than we would like. we are on top of almost every appropriate public sector project nearby and have great relationships with cities and counties. depending on availability of funding (sales of most bonds are through the state and no one is buying state bonds), we will get our share. our work load for the next 6 to 9 months is stable. our crystal ball goes blank after that. there is no doubt we will have work.
my future: been here for almost ten years and helped the firm grow from little more than two guys in a garage. brought in work too. been a mentor and almost a father to many young architects. had opportunity to buy in and declined. need to relocate and be nearer to family and property we own back east. job offers have come my way regularly for many years and, much to my surprise, the number of contacts by recruiters and larger firms has increased over the past year. as some have noted, firms are acquiring top talent to firm up their core practices. there is also keen interest from construction management firms. unless you are a top niche designer (friend does hotel interiors and he is booked solid for the next two years) public sector work may be the best way to ride this out. otherwise, look to smaller, and very smaller, firms for work. they are the most flexible and have the strongest survival instincts.
stimulus package: congress might as well give $9000 to every man, woman, and child in america, illegals included. the money gets spent or parked somewhere where it will be used. money does not just sit; it gets used and creates more value. news reports indicate effects from the currently designed stimulus package will not kick in until 2009 and 2010 with little of it actually stimulating anything, except government. think waste, fraud, and abuse. the benefit, if anything, is getting cash into the markets and onto the streets. people have to buy things, build things, invest in things. money needs to flow and move around and hopefully not overseas. the downside is devaluation of the dollar. in the short term this is okay as every currency is being devalued. for the long term let's hope other currencies revalue much stronger than they were a year ago. if you have the ability, it is a good time to invest in gold.
definitions of 'shovel-ready' abound. every little hamlet, town, and city has their own definition and are lining up at the mother pig. as a profession, we'll eventually get ours. at what price? likely, the recession//depression will have already runs its course.
during the late 1970s and early 1980s some associates did the following, in no particular order.:
*established an artisan ceramic tile business.
*relocated to canada and eventually became an executive with volkswagen.
*became a mfrs. rep for acoustic tile. he became the senior marketing person for one of the top five general contractors in america.
*became a solar energy consultant. carter gave away tax money for folks to install panels on their roofs. he eventually became a daylighting consultant and wrote a book or two.
*did surveys of historical structures under contract to smithsonian.
*learned arabic and moved to saudi. think he now teaches at tulane.
*regional construction manager for dunkin donuts. back into architecture as economy turned.
*project manager for frito-lay (potato chips, etc.)
*in-house architect for major retail chain with shops in every mall in america.
*bought crack houses and became a slum lord. he is now a member of the city council of a large midwest city.
*thought it a good time to have kids.
most stayed in architecture. several are now principals at prominent name firms.
i did not wish to leave the impression my comments were sexist. there were far fewer women in architecture then and wish to share what some i know did during this time.
*became vp of major banking organization as expansion of branch banking too off.
*went back to law school. relocated to puerto rico.
*pro bono work for community groups. now is in charge of construction for a large community college district.
*established small practice.
I think any direct tax rebates, which have been proposed, will not be spent on goods and services but instead be spent on debt obligations. 9k probably won’t keep people from losing their homes. Government spending on useful projects no mater how fast or slowly they are implemented I think is the best answer. New transit systems roads and bridges can take a while to plan before construction begins, but jobs can be saved or created right away even if the project has a long payout period.
It seems that this downturn, recession, or depression were in will have some long lasting effects on the way people consume and regard personal debt. The American Dream needs to be downsized as well. No more 2,000 sf 4 br 3-1/2 bath 3 car garage homes for every one. Things will and need to change. The notion people carry that they are entitled to a big house in a safe neighborhood with decent schools a separate car for their kids when they turn 16 is rubbish. Priorities will shift and a long slow recovery is what we face as people try to limit their debt liabilities and try to save more.
Tax cuts don’t do much to close the income/ wealth gap, but good jobs and living wages do. Big business is not obligated to spend any of the tax cuts or rebates they get, it is a gamble and I think we had enough gambling on Wall Street.
whether spent on a car, house addition, clothing, new haircut or debt obligation, the money goes somewhere, and eventually in and out of some financial institution. it is money being put into circulation and this seems what is needed immediately. government believes the money is best spent on infrastructure, honey bee insurance, or a mob museum. the process is slower and empowers this administrations little piglets.
thought of what a few other former associates did back then.
*mba and into real estate.
*went back to peru.
*automobile restoration (turned a hobby into a business)
*sold cars - not applicable today unless its a hyundai or bimmer.
*went to work for his father. think he owned a car repair shop.
*honey bee insurance is a portion of a disaster relief program for livestock producers. so, its your feeling (or is it fox news' feeling for you) that if honey producers or small businesses who rent their bees to pollinate crops suffer colony collapse that its their tough luck...
insurance against honey bee colony collapse should be paid by those in the honey business. collapse of colonies for honey bees nationwide it is a larger problem requiring investment in scientific research to learn why. just giving honey makers money to cover their losses is not right. btw, what were people planting before they availed themselves of honey bee colonizers?
am not into fox, cnn, abc, nbc, or cbs. make my own decisions. fox is running away with the ratings so they must either be doing something right or spot on with their coverage.
ps: i own a working farm.
fox "runs away with the ratings" because most of the world is full of dumb people that like being told what to do.
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