Despite the prolonged economic downturn, it seems most companies aren’t giving much thought to protecting their talent if the economy continues to worsen. One-third of U.S. companies do not have workforce contingency plans in place, according to a recent survey by Watson Wyatt Worldwide. Of those companies that say they have contingency plans in place, more than half say those plans center around layoffs, while an additional 46 percent say their plan is “to restructure their organizations.”

Few companies surveyed seem to be thinking of creative ways to protect key talent should the economy remain in a slump. Only 8 percent of companies say they are planning to offer a reduced workweek.

The Watson Wyatt study findings point to a bigger issue among U.S. companies: Most never do any workforce planning. As a result, companies constantly will be chasing the problem. When the economy picks up, they are going to be paying a higher premium for talent, experts say.

The lack of workforce planning is going to put many U.S. companies at a disadvantage in competing with their counterparts in Asia and Europe, which for the most part have workforce contingency plans. Eighty-four percent of employers in Asia-Pacific and 80 percent of employers in Europe have contingency plans, according to the Watson Wyatt study.

European companies may be more proactive about workforce planning because they are, for the most part, dealing with unions, which are more prevalent in Europe than in the U.S.

But the fact that so few companies have developed contingency plans for their workforces demonstrates shortsightedness by U.S. employers and further exemplifies the quarter-to-quarter planning mentality at American public companies.

Source: Workforce.com, August 21, 2008, Jessica Marquez