You know, we haven’t seen anything yet. Since the beginning of the year I have been speaking and developing a central theme which will be that of rigor, austerity and the end of “whatever the cost”.
Because finally when you think about it, things in life are often simple, or more precisely we can simplify them.
We can therefore summarize our situation as follows.
A / Either the health crisis lasts a short time.
B / Either the health crisis lasts a very long time.
1 / If A then we can finance one whatever the cost over a short period.
2 / If B, then we do not have the means for multiple confinements where everyone is compensated whatever the cost.
If 1 then we can increase debt without risking bankruptcy.
If 2 then we cannot increase debt without risking bankruptcy.
However, we are in the situation of a lasting health crisis, with variants, which start to settle over time, which we knew from the start, but which it was difficult to say without creating a generalized depression and great despair.
We must therefore give time to time so that people can gradually mourn their previous life, but that is not the point.
So we have a lasting crisis.
Either we monetize and we create even more monkey money and in this case we have to do it all together and at the same time, or those who will do it alone will take the risk of isolated bankruptcy.
As long as there is no consensus, and this is our case at present, states, especially in Europe, must imperatively put the brakes on spending.
So it’s the end (probably temporary) of whatever it costs.
As a result, this is going to be quite bloody and bloody socially in many companies.
It’s ADP that opens the ball!
Here is what we learn from this article in Le Parisien.
“ Keep your job or accept wage cuts? This is essentially what the management of Aéroports de Paris (ADP) offers to its 6,400 employees. Faced with an unprecedented crisis in the airline industry due to the Covid-19 pandemic, the company which manages the Paris airports of Roissy (Seine-et-Marne) and Orly (Val-de-Marne) in particular ‘is engaged in a vast economic plan.
After 160 hours of work over five months, management and unions reached an agreement in December on a collective termination of agreement (RCC) which opens the door to 1,150 voluntary departures, of which 700 will not be replaced. But management wanted to go further by signing a collective performance agreement (PCA) with the social partners. The unions said no. It must be said that the APC imposed a reduction in remuneration on employees. In exchange, the management undertook not to proceed with any dismissal for three years. “Given the situation in the airline sector, it was a great commitment,” says ADP.
Finally, on January 21, during the first social and economic committee (CSE) of the year, the management of the company decided to apply these measures unilaterally, as the law allows. A real shock for this former public company still 50.6% owned by the State“.
Clearly, ADP will force its employees to accept a reduction in salary, in case of refusal, it will be dismissal. For the unions, this project also opens the way to a PES, a plan to “safeguard” employment and therefore to massive layoffs.
For ADP management, the salary cut should be 8%, for the unions it would be between -10 and -15%!
I’m not going to say that we are waiting for the estimates of the police, but according to that of the attic economist that I am, it could be especially, that here too the process is iterative and progressive. This year -8% and then next year we put a layer back since the situation could not be better, and presto, another -10%.
Then the situation gets better. The workforce has been reduced, the activity is starting up again and we are privatizing inexpensively … a potential good deal therefore. Or not.
We will see.
But what happens on the social front at ADP is going to happen everywhere.
In banks, in aeronautics, in the automobile industry and in general in all sectors which will have to restructure.
There will be no plans to “safeguard” employment.
There will be a massive plan of job destruction and layoffs.
It is already too late, but all is not lost. Prepare yourselves !