Topic: "It is no longer cost-effective for the Perks Company to continue offering its employees a generous package of benefits and incentives year after year. In periods when national unemployment rates are low, Perks may need to offer such a package in order to attract and keep good employees, but since national unemployment rates are now high, Perks does not need to offer the same benefits and incentives. The money thus saves could be better used to replace the existing plant machinery with more technologically sophisticated equipment, or even to build an additional plant."

Response:
Perks Company's argument that benefits and incentives should only be offered to employees during low national unemployment rates is flawed. In addition, the idea that the money could be used for more technologically sophisticated equipment or to build an additional plant is impractical.

In regards to the benefits, Perks idea is flawed because they assume that when the national employment rate is high their employees would not be able to still get jobs elsewhere because of the skills that they possess. They could have skills that are still highly desired in the job market even though the unemployment rate is high. Thus, a benefits package would help to retain good employees.

In addition, it is flawed to think that during high employment rates the money should be used on new equipment or an additional plant. Investing in new technologically sophisticated equipment would require employees to go through new training. It would be hard to motivate the employees to go through the training if they are no longer offered incentives for their performance. Likewise, an additional plant would require the company to hire many additional employees, and after the employment rate is reduced there benefits and incentives packages would significantly increase in costs.

Therefore, Perks Company's conclusion that benefits and incentives packages should only be offered during low unemployment rates is flawed.