Should We Boycott Circuit City - Laying Off 3,400 Employees

[EV_Ares]

Our view on the value of employees: Circuit City's harsh layoffs give glimpse of a new world
The technology we crave is devouring jobs, reshaping our economy.
Like many companies, Circuit City has a set of company values, which it conveniently lists on its website. First among them: "Our associates are our greatest assets."

(Photo -- Laying off: Circuit City is releasing workers “paid well above the market-based salary.” / By Chris Rank, Bloomberg News)

Last week some 3,400 of them learned what that means. Their jobs were eliminated solely because the company decided they were getting paid too much.

Clearly, the company doesn't value them as "great assets." If it did, it would realize that firing employees because they've performed well enough to earn raises demoralizes everyone else. What kind of inducement is it for employees to work hard and excel if their reward might be a pink slip? And why would people want to shop at a store where the low premium on service is so loudly trumpeted?

Regrettably, this race-to-the-bottom approach is hardly limited to Circuit City. Retailers in a wide variety of specialties have looked at the leveling effects of the Internet and concluded that sales associates are not really that valuable. If they were, prices for goods bought with the assistance of salespeople would be higher than for goods bought with a few clicks of the mouse.

Perhaps this should be read as a cautionary tale about technology. The Internet is a marvelous tool. It is also a ruthlessly efficient and destructive force that is wiping out jobs and driving down wages. It put travel agents out of business and eliminates human interaction from transactions as complex as applying for home mortgages. By some estimates, it could soon have a humbling effect on workers in some high-end industries.

Alan Blinder, a former Federal Reserve vice chairman, fears that in the next 10 to 20 years, this country could see 40 million jobs in such areas as accounting, health care and computer programming move overseas. He says the Internet and other communications advances make the physical location of these workers all but irrelevant. Even Wall Street is pushing for regulatory relief to partially offset the exploding global competition for investment banking services.

All of this makes for an interesting business model. But it raises troubling questions about the direction of the American economy and society. Among them:

*Is this politically sustainable? Read through Circuit City's statement about the layoffs, and one can almost detect a sense of glee at its job cuts. This kind of treatment of employees, combined with growing disparities of wealth, increase the chances of a potent political backlash that will result in overly rigid labor laws, punitive tax rates on the wealthy and trade protectionism.

*Will the "service economy" result in the death of service? Many consumers might be comfortable buying high-end goods and services online. But others might want a knowledgeable salesperson, who might become a rarity in today's rush to cut wages.

Many economists and business experts say that in a brutally competitive world, companies have little choice but to pay workers as little as possible. They have a point. Companies aren't in the business of altruism. But since when has debasing customer service in a service industry been a model for business success? The airlines have tried that approach, and see where it has gotten them.

Salespeople can be crucial in helping businesses move products and establish brand loyalty. But they won't be very valuable if their companies don't value them.

http://blogs.usatoday.com/oped/2007/04/post_3.html

[adarling]

1. Already do

they are awful and even though i think Best Buy has problems as well, they at least have a better selection than circuit city. You would think that after all this time they would be able to compete with bb, instead they shut down stores or the stores become even crappier. I feel so bad for those people though, corporate america does not care and their workers. Not everyone, but most.

[hlthe2b]

2. I won't shop them... and it is a double edged sword..

which may result in amny more CC employees losing their jobs, I know. But, I don't know any other way to start turning this horrendous trend around. I predict that CC will cease to be within the next five years (and probably sooner)...

[LiberalEsto]

3. I'm boycotting it

I wish there was a way to boycott Fannie Mae, which is laying off hundreds of employes.

Just before announcing the layoffs, the current CEO Daniel Mudd gleefully anounced to everyone by e-mail that he was giving himself a $14 MILLION bonus.

[EV_Ares]

5. Hadn't heard about the Fannie Mae issue & the bonus is sick

I really wonder when the Tipping Point is going to be reached with the CEOs of this country and how they are running the corporations.

[LiberalEsto]

8. You're right, it's sick

I happen to know someone who works there.

Fannie used to be headed by Larry Small, the swine who sucked the Smithsonian dry of money ($4000 to install a heater in his private home pool, just one example) before being pushed to resign last week. I think they view Fannie as their personal cash cow, rather than an organization founded to make mortgage money available to Americans.

Why are so many Americans suffering foreclosures lately due to usurious home loans? Why? In my opinion it's partly because Fannie Mae isn't using its profits wisely, to make more good loan money available.

These corporate "elite" see themselves as entitled to enrich themselves with the public's money regardless of how much they hurt others or damage the organizations they head. The boards of directors give them a nod and a wink, because they're all part of that corporate elite "You scratch my back and I'll scratch yours" and the public and the workers be damned.

The workers should unionize, but breathe the word "union" and you're swiftly replaced by a foreign worker on an H-1B visa getting paid half of what you were.

[EV_Ares]

13. Right on about all of that.

It is a continuous vicious circle. The Board of Directors usually if you looked it up and followed them, are all on each others companies boards. It is an extra cash cow for them. I put you on the board at the co where I am CEO & you put me on your board and everything is a rubber stamp.

[meegbear]

4. I thought it was a given ...

I know some people who are totally apathetic to news events boycotting them.

Good to see people take a stand.

[crikkett]

6. unionize.

there's strength in numbers

[Sherman A1]

7. Precisely

This really is the answer for the CC employees and I think all at Retail. Organize and use their strength to bargain for a better lot in life. No, it will not be perfect and Yes, there will still be seriously stupid management, but being Union is far better than not being at times like this.

[The2ndWheel]

10. Around what though?

If physical reality means less and less, how much good can it do? If your job can be done from 1,000 miles away, what are you organizing around? If the jobs of 20 people can be done by 1 person with a computer, where is the strength in numbers?

You could somehow organize a world wide boycott, and put company A out of business. However that company will just merge with its competition, creating less diversity and competition, and the same process will start again.

[EV_Ares]

14. You are right; welcome to the global economy. eom.

[Sherman A1]

29. The physical reality in this case

happens to be a retail store front. So the job cannot be done 1K miles away. Retail workers need unions plain and simple. As I stated before, they will not be a silver bullet, they will not be perfect, but if these people had been in a union, there may have very well be layoffs but not a wholesale replacement of the workforce, it would have been done according to the contract in place and most likely by seniority, meaning that most likely the highest paid workers would be the ones remaining.

[Lint Head]

9. I am.

I sent them an email stating that I thought they were treating their employees horribly especially with the CEO getting a bonus.
I said they deserved to go out of business. I received a standard reply stating how they are trying to make their company more profitable. I replied that they were profiting of the backs of working people and they again deserve to go out of business. :dem:

[gauguin57]

11. I've boycotted them for years ... they're a red company, according to buyblue.com

There's also been a movement, by those who want to see noise pollution reduced around the country, to boycott such places as Circuit City because they sell those g*ddamned thumpin' speakers that have made it impossible to go anywhere and enjoy a bit of peace and quiet.

[Rydz777]

12. Tip of iceberg

Sadly this is just the tip of the iceberg - workers being treated as disposable parts while executives who run companies into the ground jump out with golden parachutes. We've lost our manufacturing industry and now the "service" jobs are increasingly vulnerable.

[flyarm]

15. i will boycott circuit city..and am ready to buy flat screen tv and new computer..

will not buy anything now from circuit city and i will be going into their store and tell them that personally!!

in fact i plan to put a sign on myself and walk through their store saying just that...

Fuck them!!

i want someone to set up a whole system in new house but i will go through a theater company instead ..that gives experts real salaries and pays for experts..and qualified people .. not just cheap labor...


after all we get what we pay for ..


fly

[slackmaster]

16. I boycott them because their service people lied to me once

I had bought a Sony cassette deck that didn't work right. It had obvious wow and flutter. It sucked.

I took it in for service. I handed it over the counter to a man who quickly connected it up, put in a tape I had brought, and played it. The sound was obviously bad. The lying, incompetent sack of shit said "It sounds fine to me!"

CC refused to honor the warranty. That was all it took. I will never set foot in one again.

[zappa_parappa]

17. Admittedly I only read the headline, but isn't kinda strange to boycott a place because of layoffs?

I mean its a sales based business, so boycotting because of layoffs would lead to fewer sales, and then more layoffs...

[EV_Ares]

20. Its the reason behind the layoffs. eom. You would have to readd

the message to understand it.

[Initech]

26. They will go belly up after the layoffs anyways.

I bet the people who end up staying there don't stay for very long, and that effect will close a lot of stores because of it.

[Mugu]

18. Can't boycott someplace that I've never stepped foot in. n/t

[ElsewheresDaughter]

19. HELL YES!

[AZBlue]

21. You can already see a BIG change in the stores!! (and not for the better)

I had to go into a Circuit City last night to exchange something I purchased previously (before the layoffs). I used to really like their stores - they had great employees and customer service!! NOT ANYMORE!! Everyone there was under the age of 24 (at the most) and sterotypical of that generation - lazy, piercings everywhere, badly dressed, standing around talking to their friends, unknowledgable about the merchandise and frankly couldn't give a d*mn about anything except when their next break was. I used to shop there often because of their prices and their service - but not anymore. If I hadn't known about the layoffs that still would have been my last visit there because of the "new" staff. Guess you really do get what you pay for, huh, Circuit City?

[chaska]

22. They're on my "shit list for life".

[pigpickle]

23. kick

[bigwillq]

24. I just went there this weekend

But I didn't buy anything.

[Initech]

25. I don't shop there anyways, their stores are horrible.

Impossible to find ANYTHING and it's impossible to find someone to help you find anything. Their stores are absolute shit. I bet that after the employees are laid off, the ones that stay don't stay for very long and the company goes belly up.

[riverdeep]

27. There is actually something of a dependant relationship

between these 'outmoded' physical stores and the brave new world of the internet that isn't really spoken of much. A lot of people will go into the physical store to try out a product and see if they like it-and then hop on the internet and look for the cheapest price online. I believe NewEgg actually used this in their advertisements. It showed a guy backing out of a driveway and the copy said something like look for it out there and then come to us to buy-wink, wink.

Nothing illegal about this of course, but when all these (physical) stores do close down, something tangible will be lost.

[riverdeep]

28. There is a larger picture here though

and for Americans, especially those with little marketable skills, it's rather bad news. Used to be, when we had a manufacturing base, even if you were none too bright, as long as you were willing to work, you could do alright. You could support a family, even on just one job, put your kids through school, retire on a pension.

Now, those people are still here, but their jobs are gone. The rest of the world is doing those jobs. What will become of our people? Detroit.

Corporations are transnational, and use one nation against another. There is really only one of two ways for America to have a future. One, kiss everything goodbye that can be done cheaper elsewhere, and only stick with and train with what America is good at. What this is in all it's variations, I don't know. Innovative technologies, maybe. The second way is for a world wide movement to occur that unifies the localities and gives them a collective opposition to the transnational gamemanship.

Either one is difficult.