How to never lose your job (a reprise)

By Neil Patrick

In January 2009, Grant Cardone put up an article in the Huffington Post with this title.

To put that date in perspective, this was about one year after the start of the global financial crisis and 8 months after the collapse of Lehman Brothers.

I agree with some of his observations, but we now have the benefit of hindsight on events which have seen the unfolding of the worst financial and economic crisis since the 1930’s.

And this has shown that Grant’s viewpoint fell way short of the mark. Even in 2009, it should have been apparent that we were dealing with something other than a cyclical recession. We were (and are still) dealing with a systemic collapse.

So let’s take a look at what he proposed. He said:

There are two groups of people that will never be without work;

1) those working for companies and in industries that are selling enough product to keep them profitable.

2) Those people within those companies that contribute to the selling, yes the selling, of the products and services of that company.

Those that are able to drive revenue through the selling of the products and services of the company are the most needed and valuable people in that company. Warning: Assist the company you work for in bringing in revenue (selling products and services) or you are at risk of losing your job!

Fair enough, but to say such people will never be without a job is a massive over-generalization. And he hinted at this when he continued:

The question is, who will lose their jobs and who will not? If you notice the people that are losing their jobs today are attached to companies that are failing! Note - if the company doesn't do well, make profits, jobs are lost! (my emphasis). The next level will not be from failing companies but from those companies that don't want to fail! (sorry Grant, but I never came across any company that wanted to fail).

What he missed was the fact that (and I don’t care about the labels that economists apply here) we are not dealing with a recession, when everything gets tough for a while and then bounces back. In a recession, companies make less profit and have to scale back some of their expenditure, whilst trying to lift revenue.

Today is different. We are dealing with a systemic collapse. And in a systemic collapse, companies don’t just struggle, they die. In large numbers. And people's jobs die with them.

And whilst companies are failing every day, that’s a symptom not the cause of the problem. The root of the problem is massive over borrowing by western governments. Plus endless QE programmes by central banks that continue to deflate the value of our wealth and earnings. Plus much needed, but unaffordable healthcare programmes. Plus an ageing population. Plus soaring food and utility costs. Plus rising house prices at least in some regions thanks to misguided government interventions (yes, that’s you David Cameron).

Compared to this, the problems faced by businesses are miniscule.

The massive and naive gamble of western governments is that while contracting government spending, they can simultaneously boost the growth of private sector businesses. And it’s just not happening. Because governments are useless at this. They launch expensive initiative after expensive initiative. Every one sounds great with all the spin at launch. And then a year or two later they are quietly shelved when surprise, surprise they didn’t work.

So we are trapped in a Catch 22.

Western governments cannot spend their way out of recession. Their currencies are losing value and their assets are dwindling whilst expenditures continue to soar. Government bonds (misleadingly also called gilts) are showing diminishing yields as investors place less and less faith in the security of such instruments.

You only have to look at the situation faced by Portugal, Ireland, Greece and Spain to see what happens when a government’s borrowing options dry up.

But back to Grant:

Those that will never lose their jobs are those that go beyond the normal expected responsibilities and the duties of their post. Those that creatively extend themselves and take responsibility for assisting the company in revenue creation will never be let go. The job of selling the products and services of the company you work, will no longer be left to the sales force but become the responsibility of everyone that desires to continue to work for that company.

Sorry Grant, this may be true in a recession, but it’s just wishful thinking in a systemic collapse. It is of course also completely irrelevant if you work in the public sector where revenue generation is completely disconnected from the success or otherwise of your employer.

What happened to all those top selling people at Lehmans, at Bear Sterns, at MF Global, at Northern Rock? That’s right they lost their jobs with everyone else. And the subsequent devastation of the whole financial sector meant that only a minority could expect to find another similar job with another employer. And if you think that banking is not typical of the world of real jobs, what about all those folk employed by Detroit City who lost their jobs and/or pension rights? What about all those staff at Woolworths, Borders, Aquascutum, Comet and countless other retailers that have gone bankrupt?

So if no-one’s employment can be assured anymore, what are we to do?

The first fact to get a grip on is that there is no such thing as a secure job anymore. It makes not a bit of difference how good you are or how hard you work, your future is never assured. So despite Grant’s opinion, my belief is that not even the best sales people in the world can count on anything anymore.

Second, if you accept this first fact, you need to be preparing right now for the day when you lose your job. That means getting your borrowings down as much as you can and building enough reserves to ensure you can survive for at least 6-12 months with no income. At least then you are giving yourself enough time to hopefully find another job somehow.

But what is a job? Essentially it’s the means by which you earn the money to live and hopefully enjoy your life. And being employed by an organisation is only one of the ways you can do this. The numbers of entrepreneurs in their middle and later years are soaring right now. And whilst many report that they don’t earn as much as they used to, almost all report that they are happier and more fulfilled than when they had a ‘normal’ job.

All this means preparing yourself for the possibility especially if you are over 50 years old that you may never get another job again. But that’s not necessarily as catastrophic as it sounds. It might just be the greatest opportunity of your life. And this is how you can make sure you never lose your job, because you will own your job and your vision for your life goals. Not someone else’s. But you should be thinking about it right now and doing what you can to start developing your ideas and plans, because when the hammer falls, your clock will be ticking…