Saturday, February 25, 2012

The economics of stupid


With word that they have to cut $250 000 from their operating budget, Saint John Transit immediately launched a "Save the employees" campaign. This is becoming an ever increasing tactic to try to avoid having to make appropriate cuts.

Companies have become very comfortable with the concept of cutting from the bottom, but have never bothered to look at the impact of continually doing this (I can't claim to know the organizational structure within this organization, but their are certain government groups which have several managers who no longer manage anyone).

The problem I have is this. $250 000 represents less than 5 mechanics or slightly more than 5 maintenance people, bus drivers, etc. It also represents 2 managers (assuming they fall within the city's normal pay structure). Which one of these cuts makes the most sense?

Of course, we the people and they the workers get screwed here (and in all of these public decisions) because managers simply do not get laid off in our society. It's about time that someone steps up and starts cutting in appropriate manners, instead of treading water (reducing service) and hoping it will continue to work.