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When production levels are reduced for any reason, corporations will reduce their work force. They cannot reduce the work force to the required level at once but must adjust hiring step by step. Firing workers will be limited to 10% of the work force per game month. In the mean time, corporations might produce at a lower level but keep paying salaries to a much larger number of employees.
When hiring, a maximum of 12% of the work force of full capacity can be hired in a single game month. This may limit the production while hiring is not completed.
If a corporation cannot find the workers it needs, hiring will be limited. In this case, hiring levels may change faster than the limits described before.
As an example, large purchases of weapons may require many new officers in the army. These officers are recruited from the group of medium level managers (up to 50 years old). If this group is depleted and none are available for corporations because they all went to the army, corporations might not be able to hire any workers at all and production will stop. (Adjust education priorities if you need officers).