Where Not to Squeeze

(Photo from Free Digital Photos)

We already had a spike in inflation, a cost of living squeeze and a cost of doing business squeeze before Russia invaded Ukraine. Now war has worsened everything. Although this won’t last forever, we are all looking for ways to get through it.

If you’re running a business, you may need to cut costs somewhere. You may be thinking surely these stresses will put workers on the back foot again, making people less demanding about their jobs. You may be thinking in that case, the easiest way to cut costs would be to lay off a few people for a while and rehire them later.

Not so fast!

Early in the pandemic, Heather Cox Richardson mentioned that government in the USA did not find it easy to rehire the pandemic-fighting expertise it got rid of when the Trump Administration took control and quickly hollowed out pandemic preparedness.

We've made that mistake before. I'll give you a simplified summary.

Expertise is Not an Ordinary Commodity

After the Apollo missions to the moon ended, there was a lag before funding came through for the Space Transportation System (Space Shuttle). NASA responded to the drop in its funding during that interval by getting rid of a lot of its Apollo expertise, believing they could simply rehire whenever Congress appropriated Space Shuttle funding.

At the time, and in the early Space Shuttle years when I worked at the Johnson Space Center, the program paid maybe a quarter to half of what private industry would have paid. Many of the Apollo experts were retired former military with military pensions to top up their income. For them, the combination of incomes was comfortable. The rest of us... well, we loved the program so much that we were willing to get by on what we were paid.

The experts NASA got rid of during the funding drop couldn't wait years to be rehired. They got jobs in private industry. They were paid much better there. They got accustomed to having higher incomes. When Space Shuttle funding came through, NASA couldn't pay enough to get its experts to come back.

The Space Shuttle had to be built and fly with more newbies in its ground crew (people like me) than would have been preferable.

NASA learned from that mistake. When the next major funding drop hit between the Space Shuttle and the International Space Station, NASA did what it could to cut other costs and keep its key expertise.

Applying That Lesson Now

If you are disappointed by performance of the Centers for Disease Control in this pandemic (as I am), Biden is not to blame. His predecessor hamstrung it. The CDC has to be rebuilt, just as the space program had to be rebuilt. Building or rebuilding is harder and takes longer than destroying. As Heather noted, a virus does not give a damn about politics. Nature is not lenient about human folly.

This happened to NASA and the CDC, two world class organizations. It can just as easily happen to your business…

Unless you learn from their mistakes.

If you need to cut back to get your business through these times, do what you can to keep your best people. They aren’t commodities. They are key expertise, key institutional memory, key producers. Lose them now and you may never get them back.