Layoffs Not An Option For Some Businesses

"We're certainly sharpening our pencil everywhere we can," said Bob Nelson, Costco's vice president of financial planning and investor relations. Nelson couldn't recall any layoffs at Costco since the closing of some stores in the 1980s.

Other steps companies are taking to cut costs are not exactly harmless to workers. Chief among them: capping the number of hours employees can work, cutting or freezing pay and suspending matching payments to 401(k) plans.

Casino operator Wynn Resorts is trimming pay and cutting back on retirement fund matches. Credit agency Equifax Inc. froze pay for all U.S. employees for 2009 and at some of its foreign offices as well.

A survey by job placement firm Challenger, Gray & Christmas this year found 71 percent of companies polled had laid off some workers. More than a quarter had implemented pay freezes or cuts.

Despite the alarming job losses nationwide, John Challenger, the firm's CEO, said it's more common now than in past recessions for companies to find other paths to savings than laying people off.

That's because many companies have concluded that layoffs could be costlier down the road. Employers who have laid people off have to find, hire and train new ones when the economy recovers. Workers with specialized skills or strong customer contacts aren't easily replaced.