Even the best of companies may fail or downsize due to the poor evolution of management, changes in the size of the business and changes in the market or technological changes. Apparently, there is no absolute earning security as an employee of any corporate entity.
Developing competence in reading financial statements can provide a reasonable safeguard against unexpected lay-offs by companies. On observing any danger signals, the employee can develop a contingency plan about alternate employment. Yet, this kind of information is not usually readily available.
Even if the financial information is made available, it is still historical and may not reflect the current threats of market or technological changes that may cause the company to falter or fail even before it can be reported by the accounting system. Then, too, the information presented may not accurately reflect the company’s true position.
Before, an alternate path to job security would have been to seek a permanent appointment in the Civil Service. Even if pay was slightly lower, at least it was “certain”. The impending lay-offs in the public sector have shaken the underpinnings of this expectation of security in the public sector.
One of the most powerful approaches to ensuring tenure of employment is for the individual worker to manage his/her earning ability like a business. If each worker saw the skills and abilities to be offered as a product and every potential employer as a member of the market where that worker can sell that product, the worker’s mindset would be appropriately transformed. The worker would be more cognisant of the need to expand the range and flexibility of personal competences as well as the need to adapt to the needs of the market.
For instance, knowledge of computer technology is rapidly becoming a prerequisite for almost any job. Every worker will soon have to interact in some way with automated services or automated reporting on the job. It is apparent that the more senior the level of employment, the greater the range of computer-related skills that may be required. Can you imagine a manager of today not being knowledgeable enough to access the Internet to research say, best practices, best prices or a range of suppliers of relevant goods and services?
Thus retraining, reorientation, and importantly, self-motivation for you as an employee is essential to your continuing earning potential. In addition, it is predicted that the new age employee will need a higher level of customer service and specific interpersonal skills. The more that is automated, the more will facilitating personnel be required to smoothen the interface between these automated systems and persons of differing skill levels.
Another parting pointer is that food will always remain first. The need to eat and drink is a basic human function. One proposed way of ensuring steady earning ability into this uncertain future period is to cultivate certain staple food crops. Yet, currently, this is not a stylish occupation or pastime; therein is a dilemma for all mankind.
There is no guaranteed way of full protection against threats to one’s earning capacity. Every way of earning a living has risks; the undertaking is to have an understanding of and to limit those risks in the area of one’s choice of employment.
It is important to recall that it is important to save. It is not always how much you earn, but that you earn steadily and consistently and that you have a clear plan that involves holding on to as much as you can – otherwise known as saving and investing – the building blocks on the earning foundation.
• Louise Fairsave is a personal financial management advisor, providing practical advice on money and estate matters. Her advice is general in nature; readers should seek advice about their specific circumstances.