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Human Factor Often Ignored : Mergers Create Big Firms, Nightmares for Employees

October 02, 1989|BOB BAKER | Times Labor Writer

Bill, Jim, Carlos and Dave, four market warehouse workers in their 30s and 40s, were sitting in a restaurant lounge in Fullerton after work, sipping beers and talking about the worst thing in the world.

The future.

For more than a year, they have been living under the shadow of a huge merger--the proposal to consolidate their supermarket chain, Alpha Beta, with Lucky Stores. Their lives, once seemingly stable, are full of uncertainty. Nobody's told them that they'll lose their jobs or take a wage cut. But nobody's made them any promises either.

When chief executive officers talk about mergers and acquisitions, they talk about constructing a bigger, yet leaner, more competitive corporation. The human factors, so intangible, are often ignored, launching waves of nervousness and cynicism among workers.

"The merger is judged simply by the bottom line, not the social consequences," said Harley Shaiken, a UC San Diego professor who specializes in work and technology. "One of the widely touted benefits of mergers is that you can produce more with fewer people. . . . There is no legal, moral or economic pressure to consider what happens to those who are affected."

When Bill, Jim, Carlos and Dave talk about mergers, they talk about lying awake at night. They talk about personal relationships souring under the strain of the same old questions asked a hundred times. They talk about putting off vacations. They talk about feeling lost in the shuffle. They talk about never knowing who to believe.

They talk about washing machines.

One of Bill's supervisors advised him not to buy one.

"He told me not to go out and buy anything even as expensive as a washer," said Bill, an expansive, 42-year-old Vietnam veteran who vacillates between anger and astonishment that life has been reduced to this level of uncertainty. "How do you stop thinking about it? How do you get away from it? There ain't enough Maalox."

The men--who were interviewed on the condition that their real names not be published--are waiting to see whether Alpha Beta's parent corporation, American Stores, which bought Lucky in mid-1988, overcomes legal objections to the merger.

Cost Huge

The cost of waiting is huge. American Stores says that it costs $1.5 million in duplicative operating expenses for each week of delay.

But that's a story they tell at the top of the heap. This is the story about the bottom.

It is a story about trickle-down anxiety, about four workers who by their own admission aren't cut out to do anything but warehouse work and who never thought they'd have to.

In the post-industrial age of frenetic corporate restructuring and "downsizing," when millions of workers have been laid off or had their hours and benefits trimmed, Bill, Jim, Carlos and Dave thought that they were the survivors, the lucky ones.

They were the ones who joined Alpha Beta in their teens or 20s and rode blue-collar jobs into the middle class. They were the ones with wives and kids and mortgages in places like Whittier, Pico Rivera and La Habra.

They were the ones with two decades worth of possessions in their company lockers and a comfortable, homey feeling about walking in the front door of the chain's main delicatessen warehouse before dawn every morning.

Earned Seniority

They were the ones who'd built enough seniority to claim day shifts and weekends off. They were the ones with $30,000-a-year jobs that, thanks to union-negotiated pensions, were going to let them retire by their late 50s.

"When I hired in, I was 18 and my dad said, 'You got a job until you die,' " said Dave, who is 34 and has a wife and four children at home. "Now, a supervisor says that some of us will have jobs and some won't, and then two weeks later, they're saying that everybody will have a job.

"But the whole point of a merger is to squeeze out the little guy. I don't know nothing, but I know that.

"I've put out feelers. My brother-in-law's a welder; I have a friend who's a mechanic. But basically, we gotta ride the ship out here and see what happens. We've been here too long," he said.

Mergers and acquisitions are easy to count. On average, 11 occurred every business day last year in businesses ranging from large banks to small transportation companies. The number has mushroomed as U.S. corporations rush to consolidate assets in the belief that it affords more efficient production and distribution and greater profits.

What is not easy to count is how mergers affect jobs. Businesses are reluctant to advertise layoffs before a merger, and government has trouble determining cause and effect afterward.

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