№ 5/2020

Ekon Ukr. 2020 (5): 41–52https://doi.org/10.15407/economyukr.2020.05.041

ECONOMIC MANAGEMENT: THEORY AND PRACTICE

УДК 331.1

JEL: J.11

MORTIKOV Vitalii

EXCESSIVE WORKFORCE IN ORGANIZATION

An analysis of the retention of excess workforce by an organization from a macroeconomic and managerial point of view is carried out. It is shown why an organization often decides to keep workers in the absence of productive employment for them.
The following are among the indicators of excessive employment: part of the personnel forced to switch to reduced working hours; part of the personnel sent on administrative leave; different dynamics of employment and GDP. Comparison of changes in GDP and employment in 2006–2018 in Ukraine allows us to detect excess workforce. Employment slowly adjusts to recessions: organizations are cutting more workers in the long run than in the short run.
There are several reasons for the emergence of excess workers in the organization: expected growth in demand; progressive organizational, technological changes. The preservation of surplus jobs and workers can also be explained by non-economic reasons.
Employers often refrain from firing redundant employees due to high transaction costs. The practice of retaining excess workers during negative shocks allows organizations to avoid hiring and training costs in the event of a subsequent improvement in the economic situation. The difference between the costs of adaptation and the costs of disequilibrium is clarified.
The formation of surplus labor is significantly affected by the limited intra-organizational mobility of specialists.
Of particular importance is the management of excess labor. There are various reactions to this phenomenon: layoffs, transferring staff to shorter working hours, administrative leave, retraining, outstaffing, early retirement. Management of redundant staff includes quantitative and structural optimization of this staff for short and long periods.

Keywords:redundant workers; workforce reservation; reasons for workforce reservation; workforce reservation costs; redundant staff management

Article original in Russian (pp. 41 - 52)

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The article was received by the Editorial staff on February 17 , 2020

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