One of the factors that led to the economic crisis of 2008-2009 began with the housing market. Lenders made it very easy to borrow money and handed out mortgages to anyone. The demand for houses increased, which drove up house values to record highs. But something had to give - and it did. Adjustable mortgage interest rates began to increase which increased the home owner's monthly mortgage payment. Many couldn't keep up with this higher payment and went into foreclosure. As a result, lenders and home builders went out of business, which led to the domino effect of lost jobs in other business environments. Businesses that did survive were forced to downsize. This creates a whole new set of issues for Human Resource Departments to handle. There is a right way and a wrong way to handle downsizing. I found this article, "Downsizing With Dignity" interesting and informative. It discusses the do's and don'ts of how to handle employees who will lose their jobs and gives examples of good and bad situations.
http://humanresources.about.com/od/layoffsdownsizing/a/downsizing.htm
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About Me
- Lisa
- I have been in the Accounting/Finance/Tax field for over 14 years and absolutely love it. Just recently I have discovered my true love - taxes. I'm currently employed at D&B as their Sales/Use Tax Manager. I'm married to my wonderful husband Joe and have 2 children - Richard is 19 and Gabrielle is 12.
Lisa,
ReplyDeleteI experienced the Housing Market crash first hand. As a Real Estate agent in the Lehigh Valley I had become accustomed to droves of buyers making their way out here from New York City and New Jersey looking to buy affordable home and start a new life. I was amazed at how easily it was for them, regardless of income or credit, to get a home loan. I did not ask any questions, I just simply did my job and found them a home they felt was suitable for them.
I put the blame for the Mortgage crisis not only on the banks, but the borrowers as well. They knew the terms of the loans (most of which were baloon or adjustable rate loans) yet ignored to plan ahead or even consider if purchasing at home at the time was the right thing to do.
I applaud the Government for stepping in and stabilizing the situation. So much of our economy depends on the health of the housing market as evident by recent economic recession.