Cathay Pacific Airways, one of the largest private enterprises in Hong Kong, yesterday announced massive layoffs. BY end of this year, some 600 employees will be made redundant. Shocked by this, civil aviation, tourism industries and citizens all express their concerns.
Cathay Pacific's plan for redundancy makes the second biggest job cuts in Hong Kong in 20 years, since the 1998 financial crisis. The job cuts are almost equal to what is caused by 10 mid-sized enterprises or several dozen small-sized enterprises going under at the same time. This will affect hundreds members of the 600 families. The impact is really not small.
On the other hand, Cathay Pacific Airways is a company Hong Kong people are most familiar with. In publicity, it is always propagandised as "Hongkongers' own carrier". Many citizens also insist on taking Cathay Pacific in travelling. Its massive layoffs inevitably will greatly reduce citizens' favourable impression and confidence. In fact, although the cuts are all back office jobs and frontline staff such as pilots and cabin and ground crews are spared, the morale of all of its employees cannot but be affected. Moreover, back office's works are closely related with frontline services. It is impossible that frontline services won't be affected by massive job cuts in back office. Such as saying is simply unrealistic.
As a matter of fact, Cathay Pacific's move of cruel-heartedly "lifting its sword" to cut so many jobs this time is questionable and irresponsible. In face of such factors as the rise of low-cost carriers in recent years, the increase of Mainland airlines' direct international flights, the decrease in number of Mainland visitors to Hong Kong and a strong Hong Kong dollar, Cathay Pacific faces considerably great competition. It made a loss of $575 million in the whole of last year, its first annual loss since 2008.
However, taking a deeper look, Cathay Pacific's loss last year is neither due to decrease of passengers nor because of shrink in cargo business. In fact, the company still made profits in both passenger transport and cargo shipping in the whole of last year. But it recorded a loss in fuel hedging as huge as $8.4 billion. The profit made by passenger and cargo services is not enough to "hedge" the loss made in fuel hedging. In this way, the performance of the company as a whole fell into the predicament of loss-making.
Facts are before our eyes, therefore, while Cathay Pacific has to massively axe jobs because of making losses, it is the top management, not the employees, that is responsible for making the losses. But employees are made redundant, becoming the scapegoat for a management's wrong decision. This is unfair for the employees who has been serving the company diligently, conscientiously and responsibly, and is not something a large institution with moral culture and a sense of social responsibility should do. The company often makes the appeal that employees should regard the company as their "home" and make selfless contributions to this "home", but once something undesirable happens employees at all levels are sacrificed who have done nothing wrong. This is bitterly and sadly disappointing.
The massive job cuts also show that there are quite many problems in Cathay Pacific's management and development planning. Cathay Pacific said in a statement yesterday that the job cuts were necessary for the company's restructuring, and this time the cuts included 190 management jobs, accounting for 25 per cent of employees at this level, and 400 non-management staff, accounting for 18 per cent of employees at this level. The jobs to be cut are in 15 departments including Marketing, Product, Engineering, IT, and Corporate Communication. Is this meant that there is still redundant staff in these departments if they can still operate normally after reducing 18 to 25 per cent of their staff members? In particular, if the company's business operation won't be affected after a quarter of management jobs are cut, then who should take the blame if such highly-paid jobs are redundant?
23 May 2017
