Reduce personnel costs – without job cuts

Personnel costs are one of the largest expenses for many companies. But savings do not necessarily have to be associated with job cuts. With the right measures it is possible to sustainably reduce personnel costs without reducing the number of employees.

Measures to save on personnel costs

If a company enters an economic crisis or sales figures decline, it is necessary to save costs. Because labor costs represent a significant portion of total costs, they often end up at the top of the list of cost-cutting measures. When it is necessary to reduce personnel costs, the first thought is usually to cut jobs. But this is not always a good decision, because at the same time the company also loses valuable specialist knowledge. He also suffers Working atmosphere and the Motivation of employees for fear of being fired. It is therefore advisable that employers first take other measures to reduce personnel costs.

1. Efficient workforce planning

With intelligent workforce management software, you can control staff deployment as needed. Through precise planning, overtime can be avoided and bottlenecks can be identified early. An optimized shift plan ensures that neither too many nor too few employees are scheduled, thus reducing unnecessary costs. Ideally, the requirements can be stored or loaded into the software.

2. Minimize overtime and extra work

Overtime is often a costly factor. Overtime can be reduced through more precise planning and more even distribution of the workload. Instead of relying on costly overtime, better capacity planning can help manage peak hours efficiently.

3. Compensatory time off instead of paid overtime

A simple solution to saving on staff costs is to celebrate overtime worked. Especially in difficult business situations, it can be ordered in a short time Reduce overtime through compensatory time off. However, this date must be announced to employees well in advance so that they can plan accordingly. It is important to note that compensatory time off must be higher if the employer normally pays overtime bonuses. Short-term compensation is usually not an issue. However, if you want to avoid paid overtime in the long term, you need to do it in time Work or collective agreement or one Operating agreement be regulated.

4. Make working hours more flexible

Flexible working time models, such as flexitime, part-time or job sharing, allow for better adaptation to operational needs. This allows companies to save on downtime costs while increasing employee satisfaction.

If there is already one in the employment contract Minimum or maximum working hours agreed, this can be used to the company’s advantage if the order situation is poor. This solution is useful above all preventive austerity measures.

We also recommend the use of temporary workerswho can provide support if necessary and depending on the order situation. The main advantage in this case is the reduction of wage and social costs compared to full employment.

5. Use automation and digitalization

Using modern technologies, administrative processes can be automated, thus saving time and costs. Employee self-service portals reduce administrative efforts in the HR department, while digital time recording, absence management and training management make processes more efficient.

6. Cut voluntary benefits

Many companies offer their employees voluntary benefits such as: Job tickets, child care offers, continuing education opportunities, or food subsidies A. When it comes to reducing staff costs, cancellations can be made here. However, caution is advised: cuts can cause unrest among the workforce and have a negative impact on work culture. So here it is especially important for transparency and appropriately communicate planned changes.

When choosing the service in question, it is advisable to do so in advance Analyze to be carried out: which service is used least and which can employees most easily do without? The consequences and effects should therefore be summarized into one Monitoring process be observed.

7. Promote qualification and internal development

Hiring new employees is expensive. Instead, it is worth further developing existing employees and specifically qualifying them for new tasks. Courses and training programs help increase skills within the company and avoid costly external hiring.

In addition, the Federal Employment Agency also offers under certain conditions state funding opportunities A. Among other things, the assumption of continuing training costs for: Employees aged 50 and over be requested. If a worker needs to be represented on a continuing education course, the employment agency will cover 50% of the salary and the employer’s share of social security contributions, if for Representing an unemployed person is set.

8. Reduce absences due to illness

High levels of absenteeism cost companies a lot. Health promotion measures, ergonomic workplaces and flexible working hours can help minimize sickness absence and thus increase productivity. Read our blog article “Absences due to illness: how to reduce absences due to illness”.

9. Apply for part-time work

If the crisis of order continues for a long time and the reduction of overtime through compensatory leave and the reduction of voluntary benefits is no longer sufficient, the introduction of short-time work is an appropriate measure. If employees work short hours, this means they will work for a certain period of time being fired from your job and receiving lower pay. Under certain conditions, the Federal Employment Agency compensates employees for loss of earnings. However, the employer cannot decide on the introduction of short-time working alone. All employees and the works council, if present, must agree. But in many cases short-time working is the best solution for everyone involved, otherwise the only option is a long-term pay reduction.

Conclusion

Reducing personnel costs without cutting jobs requires a strategic approach. Through the targeted use of workforce management software, flexible working time models, automation and qualification measures, costs can be reduced without compromising productivity or employee satisfaction. Companies that rely on modern solutions benefit from greater efficiency and competitiveness in the long term.