Wells Fargo is the latest company to announce mass layoffs due to COVID-19. Yahoo Finance’s On the Move panel discusses.
ADAM SHAPIRO: It's always disappointing when you have to talk about layoffs. And there were layoffs at Wells Fargo, they're cutting, what is it, about 750 jobs from their commercial banking unit. But this is a broader trend. We're watching a lot of companies cut jobs, and some of these job cuts are becoming permanent. I'm going to bring in to this panel chat, the entire team, because there's something else that's going on. A new survey shows that despite some of this gloomy news, 66% of companies still intend to pay bonuses this year. Who wants to go first on this one? Rick, Julie Hyman. What's up?
JULIE HYMAN: Adam, what's up is that this is the continuing of the trend that we've been talking so much about. Again, to bring in the letter K, which is the letter not just of the day, but apparently of the year. Because the idea is, more and more people do not have jobs, as evidenced by that Wells Fargo cut you were talking about. Bloomberg reports that Wells Fargo could eventually cut thousands of jobs and that this is just the beginning of that company's plans. Of course, we know Disney is laying off 28,000 folks, and there are many other companies doing the same. So those people no longer have jobs. Hopefully, they'll be able to find other ones.
For those that still do have jobs, you have that finding of the study that you mentioned. Willis Towers Watson, which is an employment advisory firm, surveying 700 companies. At those companies, about 2/3, indeed, do plan to still give bonuses. And most of them also, 35% have reduced their pay raise plans. But they still plan to give raises. They're just small ones. So again, this just emphasizes the divide between people who don't have jobs at all and those that still do, are likely to get more money, because the employers want to retain those folks.
RICH NEWMAN: It's also the skills mismatch, Julie. I mean, we know what happens. I mean, we were actually in a pretty good place back in February. We had so much tightness in the labor market, that almost everybody even wanted a job could get a job. And we saw labor force participation really improving. And that has just been demolished, unfortunately.
And the worst, the most worrisome news here, is that for people at the bottom end of the skill spectrum, it's just going to take, unfortunately, a long time for them to claw their way back. And we know it took almost 10 years from what we saw in the Great Recession back in 2008 and 2009 to repair all that damage. And we're in a similar hole now, I'm afraid.
MELODY HAHM: And when you think about the kinds of jobs we're talking about, that really heavily depend on commissions, on bonuses, those are sales opportunities. And I can tell you firsthand based on some anecdotal evidence, that there are tons of opportunities in that space still, even if those bonuses are going to be lower than anticipated. Lots of recruiting continuing to happen, lots of poaching continuing to happen in that area. So to your point, unfortunately, it's just the kinds of opportunities that are available are for a very limited subset.
And then kind of tying it back to our women in money segment, who are the folks who will get passed up for promotions for additional bonuses? Perhaps those who are on maternity leave right now. Perhaps those who are not able to contribute as much as their normal level, because they don't have adequate daycare, because they have to help with at-home schooling. So unfortunately, all of this sort of is a very deadly concoction in a certain degree, especially for minorities and women in the workplace.