Where Did Everyone Go?

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GHOSTLY CUBICLES: With less help, Melanie Mancebo must wear more hats

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Agilent Technologies, a Palo Alto, Calif., electronics and tech manufacturer, made Fortune's 100 Best Companies to Work For this year despite having announced 20% job cuts of 8,000. At the time, employees rallied around management to fight to save the company. But unlike Dell, Agilent continues to struggle, and the surviving workers are feeling the strain. Steve Peterson, 55, a global online-support manager, says, "We are just really working hard and are discouraged that things are not better."

Discouragement and stress are serious issues for ghost workers. "Already we're coping with 9/11 and the possibility of war with Iraq," says Michael Faenza, a social worker and head of the National Mental Health Association. "On top of that, the larger workload and stress on productivity leave workers less able to focus on the work at hand. It can lead to depression, anxiety, substance abuse."

Perhaps the only people more frazzled than those struggling with ghost work are their managers. Jim Pilgrim, a director of product management at e-business support provider Digex, had enough on his hands boosting the rock-bottom morale of his overextended workers. Their Laurel, Md., employer had recently cut 650 jobs. What's more, workers' blues were compounded by a sense of betrayal by the firm's parent, WorldCom. Pilgrim, 46, suffered too. "I go home and run, do yoga and meditate," he says. "It chips away at me, and I see it in other people." Managers "suffer the same sort of shame and guilt as all the workers, but they can't disclose their feelings and they're supposed to provide the leadership," says Willie Garrett, a psychologist and director of employee-assistance services at Ceridian, a human-resources firm in Minneapolis, Minn.

The problems suffered by ghost workers can be costly. CCH, a human-resources consultant in Riverwoods, Ill., found that this year nearly twice as many employees as last year are logging unscheduled "sick" days for "personal needs"--21% of total absences. Overall, absences are costing employers an all-time high of $789 per worker. "When people get stressed, they are more likely to call in sick, even if they aren't," says Helen Darling of the Washington Business Group on Health. "But when there have just been layoffs, the opposite occurs." Those handling lots of ghost work come to the office even when they are sick for fear of being laid off which doesn't exactly help their well-being or that of their co-workers.

Many employers remain woefully unprepared to help their work forces adjust. Some 30% of firms polled last year by the Society for Human Resource Management said they took no steps to reduce employee stress in the wake of layoffs. The growing sense of crisis among ghost workers, however, is forcing some employers into action. Pinnacle West Capital Corp., an energy company in Phoenix, Ariz., that is eliminating 600 jobs, plans to stop requiring so many meetings and reports.

One consolation that those burdened with ghost work won't see is cash. With raises frozen and more health-care costs passed on to workers, some employers are recognizing the need for what John Challenger of Challenger, Gray & Christmas calls "recession perks." His firm queried companies across the country and found many that had adopted cheap, creative ideas. Harley-Davidson lends its motorcycles to workers and rewards some with front-row parking. A Florida-based Toyota distributor built an on-site day-care center for employees.

Telecommuting is another popular perk. Twenty-eight million Americans telecommuted in 2001, up 42% from 1999, according to the International Telework Association and Council. "Of course I used to telecommute two days a week, and now it's down to one," says a mother in her 40s who works in sales at a top Wall Street firm. The worker, who requested anonymity, survived a massive layoff and has taken on many duties once performed by junior employees. "Still, I feel fortunate."

Some companies look to kill costs and ghost-work stress with a single stone: unpaid vacations. Since BellSouth offered unpaid leave to its 80,000 remaining employees in July, almost half have grabbed it saving the Atlanta-based telephone company $14 million in payroll costs. Some firms, though, have made unpaid vacations mandatory. Last year Dell demanded that workers take one-week vacations without pay. "That had a lot of people grumbling," says an employee.

Some employers have managed to avoid layoffs altogether by asking all their workers to sacrifice. Patrice Tanaka, 50, who runs her own New York City public-relations firm, began trimming costs last year by deferring tech upgrades and bonuses. She then snipped staff perks like free bagel breakfasts, ice cream, yoga even the fresh flowers that once perfumed the loft offices. It wasn't enough. In a last-ditch effort to hold on to her staff of 40, she asked her partners to swallow a 20% pay cut and other workers to forgo 10%. "It's not a Utopia; we have our good and bad days," she says. But business is picking up, no one has left, and their kindly yoga instructor even donates her time. Says Tanaka: "She says we need it now more than ever."

CORRECTION: In our article on companies who have laid-off workers (Business, Nov. 18), we said in error that Dell, the computer maker, hacked 6,000 of its 40,000 jobs over the past year and that during this time Dell increased revenues, profits and market share due in part to shrunken payrolls. Dell cut 5,700 jobs in 2001. The improvements in revenues, profits and market share occurred in 2002.