Abstract
The U.S. Government’s taking over of Fannie Mae and Freddie Mac, and the collapse of Lehman Brothers signaled the beginning of the global financial crisis. Companies must cut their operating costs in order to survive and thus layoffs have become a necessary measure. Meanwhile, with a gradual economic recovery, companies’ short term orders are soaring and in order to meet the rapidly rising short term demands in the face of uncertain long term demands, companies are faced with a dilemma: to hire permanent or temporary employees?This study aims to analyze this dilemma faced by the semiconductor foundries during the financial crisis by means of a case study. Semiconductor foundries laid off employees to reduce the operating costs but the condition of the semiconductor industry turned around faster than expected, so the capacity demand increased. As the result, the companies faced a critical shortage of production technicians and the companies must decide whether to hire permanent or temporary employees. The solution chosen by HR departments are to hire temporary employees.The key of this study is to evaluate whether the benefits of hiring temporary employees met the expectations. The evaluation criteria are based on cost, production efficiency, and employee psychology. The production efficiency is assessed through interviews with manufacturing executives, technicians and temporary employees, and also through the “technician performance evaluation system.” Finally, the case study is analyzed through both theoretical and practical perspectives, and suggestions for future study are provided