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He replaced the company's formal holiday dinner with a pizza lunch, restructured to get more people into the profitable Sales Department and is debating whether to trim benefits for his 14 employees.

But Van Hemert is keeping lay-offs out of his cost-cutting equation. The last time he let workers go was more than a year ago, and he hired all of them back within three weeks.

So the employees are doing their part, voluntarily cutting their hours from 45 a week to about 30 and fixing service lorries on slow days.

"Business has crashed, but it's not the employees' fault, so we try to protect them," Van Hemert said. "If you send a guy home, the first second there's nothing to do, you're going to wreck your company, its reputation and the attitude of everyone who works there."

With 62,000 jobs lost nationwide last month, and workers' anxiety about lay-offs growing, many employers are getting creative before pulling out the pink slips.

They're cutting overtime, getting rid of the office cleaning service and slashing perks before sending loyal workers into an uncertain job market.

"We're at a time for many businesses right now where it doesn't look like there's going to be a turnaround," said John Challenger, CEO of Chicago, Illinois-based employment-consultant firm Challenger, Gray and Christmas.

"So they're now taking a hard look at what they need to do, short of lay-offs, in this period of hunkering down and battening down the hatches to wait out the storm."

Many employees have years of institutional knowledge, which makes them difficult to replace, experts said.

"It costs a lot to let someone go," said Don McNamara, president of Laguna Niguel, California-based management-consultant company Heritage Associates.

"So we've got to circle the wagons and pull in a little bit."

He said businesses could cross-train employees in multiple roles, to boost productivity and restructure to remove inefficiencies. Executives should "get out and start stumping with the rank and file and looking for more business".

Employees, meanwhile, are agreeing to sabbaticals, unpaid vacations, lowered salaries, even work furloughs - also known as "temporary lay-offs" - in order to avoid the real thing. AirTran Airways last month said it was cutting wages 5-15 per cent at the low-fare airline, to help reduce costs amid record fuel expenses.

Others, including state and local governments, have instituted shorter workweeks with fewer days and hours.

Last Tuesday, Birmingham, Alabama, began offering the option of a staggered four-day workweek for more than 70 percent of city employees, to save on fuel costs and buffer against lay-offs.

Utah will become the first state on August 4 to mandate a four-day week for most government workers, with an expected 20-per-cent saving in energy costs once buildings are closed on Fridays.

Challenger said some businesses had slashed benefits, diluting the amount matched in contributions to a 401(k). Tuition-reimbursement programmes have been cut, and in-house fitness facilities have been closed.

A recent report from his firm predicts more workplaces will replace travel budgets with teleconferencing technology, to save on air fare and petrol.

Companies will also try to reduce real-estate costs by closing corporate headquarters and leasing smaller office spaces.

Challenger said many companies, including Best Buy, Yahoo and AT&T, were already using such techniques.

Santa Clara, California-based Sun Microsystems saved US$400 million (Bt13.46 billion) in property expenses over six years by allowing employees to work from home or a satellite office.