I’m just a lowly associate. Can someone explain staffing and layoff models. Why’s my firm firing 10 people and then re hiring 8 people. Wouldn’t it make more sense to just reduce salary and attempt to retain people. Just trying to understand the logic

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This is a great question to ask, very politely, as a point of curiosity of your boss. Done right, you look smart, not critical. Could be many factors.
Different skills needed
Toxic relationships
Unpredictable income streams

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One method of cost cutting is arbitrage. Leverage the excess supply of consultants in the market to hire for lesser than what you are paying. Get better aligned skills and in the right areas.

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👇

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People really don’t like reductions in salary. If you reduce people’s comp they’ll leave anyways. Better to lay off 10 people and keep things BAU for the other 90 than to reduce salary for 100 people and have 50 leave on their own. They hired 8 more people at lower rates after laying off 10 since the market value of people’s roles is down.

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I have no idea about your firm or situation, but one potential consideration is the overall promotion timeline.

Experienced associates will be up for manager (or whatever other levels your firm has), which then starts the clock for principal/partner/etc.

A consideration could be that your firm doesn't think the pipeline is ready for a wave of ppl moving up and wants to reset

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Up or out model - 10 let go didn’t have potential to succeed at next level. Hired in 8 to keep the pipeline full. Not the case 100% of the time but that’s the general flow

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Would you stay if your company lowered your salary?

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You can’t really cut salaries and expect improved performance, or that people will work well with new hires brought on after their salaries were cut.
It’s better for performance to layoff and rehire at lower rates.

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A lot of hiring occurs directly from universities and so they want to keep the hiring up to maintain the relationship.

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