Yesterday, I highlighted the harsh wages cuts being demanded by The Boston Globe–and, yesterday, the workers voted narrowly to reject the cuts, after which management, in typical bully behavior, said it would now unilaterally impose the 23 percent cut. Before I move on to a bigger point–I wonder if Arthur Schulzberger, the publishers and chairman of The New York Times Co, which owns the Boston Globe, imposed a 23 percent cut on his own salary. Ummm…we’ll let you answer that.

   What did catch my eye this morning was a piece in The Wall Street Journal:

Pay cuts, rather than layoffs, have emerged as an alternative way for many companies to reduce labor costs as demand slumps during the recession.

If enough companies use pay cuts to avoid layoffs in the future, then the unemployment rate may no longer give a true reading on how workers are faring. [emphasis added]

   I’ve long been skeptical of unemployment numbers and government statistics generally. The numbers eported in the press don’t reflect the true depth of the challenge of finding work (not to mention good-paying work) because typically the traditional press leaves out the numbers of people who have given up looking for work and who can’t find full-time work–a number which when added to the number we usually get easily pushes the true unemployment figure into double-digits.

   But, the point of the above observation in the article is clear–telling us about unemployment will have less of an impact if you cuts wages and people can’t survive on their paychecks (paychecks that haven’t reflected the growth in productivity for THREE DECADES–meaning people worked hard but didn’t get the benefit of their hard work).

   Here is the very last sentence of the article, which should have been much higher up:

Many companies oppose pay cuts as much as the rank-and-file do. Pay cuts are often demoralizing, and low morale can cut into productivity, which is a backdoor way of raising costs. [emphasis added]

   Demoralizing. You think?