Jobs suffer as companies scale down operations

ORGANISATIONS will continue to downsize and this will mean fewer career opportunities for employees, the Institute of Personnel and Development's (IPD) conference was told.

Mr Mike Fiszer, managing director of the British-based consultancy, MOST, said the world of work is moving from job security to multiple career changes. He said the emerging trend is from yearly wage increases to a pay structure tied strictly to performance.

Mr Fiszer said there is a move towards fewer promotional opportunities and a retreat to the core business by restructuring and downsizing and merging management layers. He said these trends began in the late 1980s and will continue to be forced on organisations.

"The old psychological contract that led to loyalty in exchange for job security or employment has now gone," he said. "Employees are being offered employability or marketability as the new contract."

"Job security and career development is now their issue. They now have a career opportunity, no longer a career."

Mr Fiszer said most people are expected to get used to the "feel worse factor" now introduced in their lives.

However, he warned that the organisation's "psychological contract" in terms of needs and expectations may also be at risk. "Young and struggling organisations requiring higher levels of motivation and effort, those under attack or in trouble expect more loyalty with a `we are all in this together' approach," he said.

"Both may be bitterly disappointed with the responses from such employees when the time comes," he said.

Mr Fiszer explained that recent reports from the Cranfield School of Management had found new graduates, and those who survived the 1980s and early 1990s, are posing new problems for organisations.

"They are more interested in themselves than the organisation, but it has also been reported that key people with core organisational competencies are looking to sell those skills to several bidders over a shorter period of time," he said.

"There is a new breed of entrepreneur out there very similar to those found in small and medium enterprises. In this sector, careers have always been about employability and `if you want to get on, get out'."

He suggested looking at this sector - in which 95 per cent of the workforce is employed in organisations of less than loo "for the new model psychological contract between organisation and employee".

Mr Damian Dyar, a partner in Emerge consultants, told the conference that the human resources function, especially in larger organisations often demonstrates the classical characteristics of a machine bureaucracy. "It is the determined and arbiter of standards," he said.

Mr Dyar told delegates that it seeks to create inflexible and mandatory systems for issues such as pay and appraisal. "It utilises its energy to the higher echelons of the organisation to control those at the lower level, to whom it pretends only to give advice.

He said such human resources models had no place in the "fast moving tighter budgeted, more empowered organisations" of the 1990s. "Directors and managers in the future will have to become more like professional support networks to the rest of the organisation, operating tightly and in a well-focused manner."