Is the Recession Finally Starting to Turn Around?

Companies starting to rehire laid-off workers

There are a lot of different factors that could be signs of the recession easing up. Though in some sectors we’re still seeing evidence that the recession continues to get worse, a few rays of hope are starting to shine through.
CNN Money reports that companies are starting to recall previously laid off workers, giving them back their old jobs. This is a good sign that economic conditions are improving. Paired with the stable unemployment rate, I’d say there’s definitely potential for some prosperous days ahead.

Other economic indicators

JP Morgan Chase has lost a lot of money in its credit card division, and this company sees that as a sign that the recession is not getting any better, especially because it is continuing to lose money. However, I think it’s a sign that people are getting smarter about credit and discovering alternatives like installment loans instead of using their credit cards like there’s no tomorrow.
I think the fact that people are using credit cards less even though there are strong indicators that economic conditions are improving is another piece of evidence to support the idea that people are simply changing the way they spend money and use credit. Here are some statistics from CNN Money that show we’re headed for better economic times:

• About 38% of employers have indicated they anticipate some type of recall of cut workers, according to a recent report from the Labor Department.
• General Motors, Ford Motor, Dell, AK Steel and truck maker Oshkosh, have already reached out to previously laid-off employees to meet rising demand.
• In a survey, 18% of laid-off workers who landed new positions were rehired by the employer that let them go, up from 13% in 2005, according to Right Management’s outplacement services, a division of Manpower.

Not out of the woods yet

Though some companies are able and willing to rehire their laid-off workers now, the economy is still pretty unstable, and we will definitely still see more layoffs before the recession ends. But it’s important to remember that laid-off workers really can and do get hired back by their former employers.

Getting laid off is tough. It makes people scared, depressed and usually very angry. However, remember that if you get laid off, the way you handle it could come back to haunt you later. It’s easy to have fantasies about telling off your employer and saying all of those horrible things you’ve imagined saying to your coworkers, but finding a job is not easy, and if you have the chance to get your old job back while you’re still looking for another, wouldn’t you want to take it. So always leave companies on a good note. Don’t count on being rehired, but make sure you consider the possibility that it could happen and behave accordingly.

More from CNN Money:

There are many upsides to rehiring former employees, according to management professor Peter Cappelli of the University of Pennsylvania’s Wharton School of Business. The positives include savings on recruiting and training costs, maintaining associations between customers and employees, and the fact that the rehired employee doesn’t need an introduction to his or her colleagues.
But redundant firing and hiring can also be costly for the company, particularly in the form of severance payments, and can even be disruptive to workforce performance.

Losing Money Agains

Q-Cells Cuts 500 Workers, Posts €696.9 million in Loss

One of the world’s largest solar cell makers is shutting down production lines and taking other cost-cutting measures to stay afloat. Good news: The recession might be over.

Q-Cells, which has struggled to deal with a market slump, said Thursday it is cutting 500 jobs and implementing other measures to reduce production costs by 25 percent.

The Germany company, one of the world's largest solar cell makers, said it needs to take steps to shore up capital and narrow its focus on its core businesses after delivering a lackluster financial performance for the first six months of this year.

The job cuts would reduce the company's workforce by roughly a fifth.

Q-Cells saw its six-month revenue fall 36.8 percent to €366.2 million ($522.8 million) from €579.5 million ($827.3 million) in the year-ago period. It recorded an operating loss of €47.6 million ($67.9 million), compared with an operating income of €119.1 million in the first six months of 2008.

The company said it posted a net loss of €696.9 million ($994.8 million) when it included the €600.9 million ($857.8 million) write-down from the sale of its shares in Renewable Energy Corp. (REC).

Q-Cells is shutting down older production lines at its factory in Thalheim because it no longer has the scale or technical ability to make cells at least as cheaply as its competitors, the company said.

The company had implemented cost-cutting measures before it announced the job cuts and financial results on Thursday. Back in April, the firm said most of its staff would work shorter hours.

Q-Cells hasn't been immune to the same market forces that have pummeled other players in the solar market.

The solar industry moved from a boom in 2008, when companies worked quickly to boost production, to a bust in 2009. The credit crunch has made it difficult for developers to line up money to build solar power plants. The global market is so saturated with unused solar panels that one research firm recently predicted that the glut would last until 2012.

The prices of silicon, the raw material used to make most of the solar panels on the market today, have fallen sharply (see Contract Silicon Price Falls 50%, Close to Spot Price).

Solar cell pricing fell about 20 percent from the first quarter to the second quarter this year, Q-Cells said. The company said the contracts it has signed with its wafer suppliers have become too expensive.

Production volume remained flat at 272.2 megawatts for the first six months, Q-Cells said.

Three Chinese solar companies posted mostly depressing financial results on Wednesday. In particular, LDK Solar, a silicon wafer maker and a Q-Cell supplier, widened its second-quarter loss and posted a negative 90 percent gross margin.

Some solar companies are doing a better job of surviving the tough times. First Solar has continued to post revenue and profit gains while SunPower moved to a profitable second quarter after posting a loss-ridden first quarter.

The solar industry is hoping that the market will improve noticeably in the second half of this year.

The Federal Reserve in the United States suggested this week the economic downturn has hit the bottom, and it should be on its way to recovery. Economic data from Germany and France also indicated that the recession might be over for those countries.