Time to raise employee confidence One of the country's largest trucking companies shut its doors on Labor Day. Consolidated Freightways, headquartered in Vancouver, Wash., announced that it was closing its U.S. operations after 73 years. At least 80 percent of the company's 15,500 employees lost their jobs immediately. The company filed for Chapter 11 bankruptcy protection the following day. In a statement, company chief executive John Brincko said that without the availability of additional financing, the board of directors concluded the company could not continue to operate, pay employees and meet its obligations. Consolidated lost $36.5 million during the first quarter of this year, $104.3 million last year and $7.6 million in 2000. Consolidated, the third largest U.S. less-than-truckload carrier, took partial shipments from multiple companies and delivered them throughout North America. It operated 350 terminals and 30,000 trucks in North America. The demise of Consolidated was the largest ever to occur in the trucking industry. The American Trucking Association reports that 7,000 carriers with five trucks or more have closed in the past two years. The elimination of Consolidated jobs was not good news for an uncertain economy that saw worker layoffs climb to more than 118,000 in August, up 46 percent from the job cuts in July. Employee outplacement company Challenger, Gray & Christmas said if the job cuts continue at the current rate, 2002 would be the second highest year for layoff announcements since 1989, when the company began tracking this data. Only 2001 would rank higher. Meridian Resources, an employment consulting firm based in San Francisco, expects more layoffs will occur this fall and winter. The reason, said Meridian president Ron Gant, is some publicly held companies will seek to take charges against their earnings for severance- and termination-related costs before the end of this fiscal year. Manpower Inc., the country's largest staffing company, reports people shouldn't expect an increase in the number of job openings through the end of the year. Its quarterly survey of 16,000 companies indicated only 25 percent planned to hire more people during the fourth quarter and 9 percent said they would reduce their workforce. The remaining survey respondents didn't expect to make any changes or they were uncertain. Rebuilding employee trust One major concern with the recent financial problems of companies like Enron, WorldCom and now Consolidated Freightways is the decline in worker trust and confidence in senior management. Washington, D.C.-based Watson Wyatt Worldwide, an international employment consulting firm, found that among the nearly 13,000 workers who responded to its WorkUSA survey, only 39 percent trust senior leaders at U.S. companies. There was a 5-point drop from 2000 to 2002 in both the percentage of employees (45 percent) who say they have confidence in the job done by senior management and the percentage of workers (63 percent) who believe their companies conduct business with honesty and integrity. Ilene Gochman, author of the survey, said that "Falling levels of employee trust are a major threat to future corporate competitiveness." Gochman said employee trust levels and company performance are closely linked. The Watson survey found that the three-year rate of shareholder return was nearly three times higher at companies with high trust levels than at those with low trust levels. "Unless companies can resolve the crisis of confidence among their employees, there is little hope of restoring the trust and confidence of investors which is so critical during these tougher economic times," Gochman said. By assessing the decline in trust levels, Gochman said companies can gain insight into how serious the problem is among their workers and establish a baseline against which to measure their efforts to restore this trust. Send this article to a friend Enter your e-mail address: Enter your friend's e-mail address: Click the image below to send: © 2002 Branch-Smith Publishing