It’s something no one wants to do or have done to them. Yet, we can expect layoffs on the rise this year.
Nearly 40% of companies say they’ll likely lay off employees in 2024, according to a ResumeBuilder survey. A quarter of those employers say layoffs will affect as much as 30% of their workforce.
Why are layoffs on the rise?
While you might have your own reasons for layoffs this year, researchers found these are the most common reasons companies will let employees go:
- Need to reduce costs (69%)
- Anticipate an upcoming recession (51%),
- Desire to increase profits (42%)
- Replacing workers with AI (39%)
- Outsourcing (20%), and
- Merger or acquisition (15%).
They’re legitimate business reasons to reduce a workforce. But that doesn’t make it easier on HR, who usually has to shoulder the difficult task of letting people go, managers, who have to decide who to lay off, and the employees, who are on the receiving end of the termination.
“Layoffs are a huge trust killer. They just are,” says Harvard Business School professor Sandra Sucher on the HBR on Leadership podcast. “You’re worried about the people who you let go, and a bigger concern is actually the attitude and engagement of the people who are still there.”
Here are seven tips to help make layoffs easier on everyone involved — those who leave and those who stay.
1. Be very clear about ‘why’
First, being clear and transparent about the reasons behind layoffs will help you avoid legal issues. Tell employees exactly why you must reduce the workforce and how you decided which roles would be eliminated.
Even better is transparency all the time. When employees know there’s trouble or potential for employment changes, they can be better prepared when something comes down the line. They’re more resilient when they understand how outside forces might impact their job, profession, industry and company.
Try to get all leadership levels in on the announcement and/or discussion, delivering consistent, clear and effective message that allows for employee feedback.
2. Provide resources
Very few things can make layoffs good. But when you accompany them with resources to help employees get back on their feet quickly, you can make them good enough.
Some things the best-in-class companies do include:
- Adequate time for employees to get all the information they’ll need to move on, gather their personal belongings and say goodbyes
- A severance package that includes as much extended health benefits that you can provide
- Help obtaining services such as unemployment and COBRA benefits, and
- Written and verbal references.
3. Offer transition help
More than 75% of employees who’ve been let go and received transition assistance felt the experience was positive, according to a survey from Keystone Partners. Even better, 65% of employees who survived a layoff, and knew their laid-off colleagues got career transition services, viewed their employer in a positive light. Making sure employees are in a good position to move on is a positive reflection on the company.
Those services and assistance might include helping laid-off employees:
- Create resumes and cover letters
- Access career counseling and coaching
- Sign up for job training or degree and certification programs, and
- Meet other local employers who are hiring.
4. Consider ‘long layoffs’
There’s a growing trend that helps employers and employees when layoffs are a must: The long goodbye.
Some big employers in the entertainment and finance industries are trying layoffs that can take weeks or months, allowing employees to share institutional knowledge, collect a paycheck while they look for new jobs and interview, and thoughtfully prepare for what’s next. In the meantime, the companies are getting credit for compassion and transparency.
So, if it’s possible, work with employees to lessen the ill effects of an old-fashioned blunt separation.
5. Follow up on layoffs
We can give you a myriad of reasons for following up with employees who were laid off. It’s human kindness. You maintain a network. Your company’s reputation stands tall. All employees see you in a positive light.
But most of all, you maintain a relationship with people you might not have wanted to leave — and who might come back some day.
So try to schedule intervals after layoffs to:
- Check-in on the well-being of employees, their families and situations
- Give tips or updates on job connections you might have made with other employers
- Update them on the resources that were made available, and
- Let them know what’s going on in your organization as far as callbacks, restructuring and/or attrition that might affect them.
6. Support remaining employees
Employees who keep their jobs aren’t always elated about it. They might be overwhelmed with the work that remains, upset at the departure of friends or suffering from “survivor’s guilt.”
You’ll likely want to engage and support them more than before layoffs. Some ways:
- Talk regularly about how the company is helping — and will continue to — those laid off. When possible, let them know when their former colleagues landed in new jobs or have landed on their feet differently, perhaps schooling or retirement.
- Give employees space and time in meetings to talk about how they’re coping with the bad news and departure of friends.
- Ask about and ensure remaining employees have the resources they need to get their inflated work done. Many of them may be putting in longer hours and picking up extra work to fill gaps.
- Remind your remaining employees about resources, such as Employee Assistance Programs and Employee Resource Groups where they can share and process their experiences.
- Consider taking some extra measures. You might set up one-on-one meetings or make personal calls to every employee to see how they’re doing and what they need to support their career and well-being.
7. Reconsider layoffs
So this final point is if there’s still a chance you can avoid layoffs. It’s important because layoffs hurt businesses, not just people.
In her research, Sucher found layoffs lead to reduced engagement, work quality and safety. It also reduces innovation, product development and sales.
Bottom line: Companies that go through layoffs underperform companies that don’t. The cost-cutting almost always results in internal failures that hurt company growth and success.