Unemployment Rising: How do Christian Business Owners Manage This?

As businesses experience a drop in sales, they are forced to cut their expenses in order to maintain solvency. One of the main places to cut is labor, which is usually a company’s first or second highest cost. The Wall Street Journal has a couple of interesting articles about our current, rising unemployment numbers. The U-6 unemployment rate hit 12.5% while the more traditional rate currently stands at 6.7%.

As Christian business owners, we’re in the same boat as anyone else running a business: we must cut costs in order to remain solvent. I’ve been laying off people in my own business, something I had hoped to avoid. How we layoff our people is important, so I’ll offer a few ideas:

  1. Be direct and honest. When you lay people off, don’t beat around the bush. Being direct and honest shows them respect.
  2. Offer them some type of outplacement service.
  3. Be sure to pay them their severance, on-time and any remaining PTO and benefits they might have accrued.
  4. If it helps, write them a letter of recommendation indicating that their position was eliminated and that the layoff wasn’t due to poor performance (if this is true)
  5. Realize that God has something in this for them too.

Remember that as stewards, we’re charged with running our businesses in a profitable way. Going into debt to pay people’s salaries is not good stewardship. Businesses are not charities. So steward your business, perhaps consider taking a pay cut for yourself and keep your employees as long as possible. But if you have to lay them off, do it in a way that preserves their dignity and your relationship with them.

Bill English