Outplacement Firms Grow In Number and Popularity As Companies Trim Down
WESTBOROUGH, MASS. — FOR the unemployed, getting up each morning and heading to the office does not necessarily stop after losing a job.
Many of today's jobless are reporting to ``outplacement'' operations for career counseling, leads on new jobs, tips on resume writing, a supportive office environment, and more.
Indeed, the outplacement business has been growing faster than ever as companies cut personnel and as the service becomes more widely known and used.
Between 1990 and 1993, the number of unemployed served by outplacement firms in the United States more than doubled, according to a September survey conducted by the Association of Outplacement Consulting Firms International (AOCFI) in Washington. Outplacement industry revenues increased from $392 million in 1990 to $625 million in 1992 and are expected to reach $700 million this year.
The industry is relatively new. The first outplacement services, introduced commercially in the 1960s, were not widely used in the marketplace until the late 1970s, says Steven Worth, executive director of AOCFI. ``It's really just a greater awareness that the service exists commercially,'' he says. ``Once a company has used the service, they realize it is a useful [tool].''
It used to be that only Fortune 500 companies hired outplacement firms to take care of their top executives. Now, large and small companies use these firms for both white- and blue-collar workers.
The outplacement firms tend to work mostly for employers, but some offer services to individuals. Usually, they provide telephones, computers, and secretarial help to recently laid-off workers, or ``candidates,'' as they are called. Either the outplacement firm or the company involved provides office space.
While employees benefit from the job-search services, employers find that outplacement agencies reduce company severance payments, mitigate possible legal action, and, of course, ease corporate guilt.
``Firing anybody, at best, is an unpleasant task and nobody likes to do it,'' says James Kennedy, publisher of Kennedy Publications in Fitzwilliam, N.H., which tracks the outplacement industry. ``So, when it can be sweetened this way, it just makes sense.''
Services and approach vary from firm to firm. While some outplacement companies provide practical job-hunting assistance, others may take a more psychological approach and offer counseling, emotional support, and group workshops. Larger firms tend to offer a combination of the two.
Outplacement agencies these days often see the same types of individuals walk through their doors: white-collar middle managers. ``We have seen and continue to see ... the flattening out of the corporate pyramid and the elimination of middle management,'' says Warren Radtke, an executive vice president with Right Associates, a major outplacement firm headquartered in Philadelphia. In America's changing workplace, middle managers - seen as processors of information - are being replaced by new technology, he says.
One example is Joseph Conway (not his real name), who worked as a manager for an office products manufacturer before being laid off two months ago. He spends time each day at the Westborough, Mass., branch office of Lee Hecht Harrison Inc., one of the country's largest outplacement firms headquartered in New York.
Seated in one of the single-room offices reserved for job seekers like himself, Mr. Conway says he is taking the search very seriously. ``When you're in a job-search mode, it's important to approach it as a full-time job - to come in here and go to work,'' he says. ``Most people find it difficult to work at home. It's not good for thinking work.''
Some people who have lost jobs arrive at outplacement firms angry and shocked. Others are actually relieved and happy about finding a new job or career.