Boosting Morale and Productivity of Layoff Survivors: Tips for Leaders

Amazon and Salesforce are the latest tech companies to announce job cuts. This comes after rapid hiring by these companies over the last several years. For every company announcing layoffs, senior leaders and managers must keep the remaining employees motivated and productive. This can be a challenge, but it is essential to maintaining a successful business.

U.S. companies announced 172% more layoffs in the fourth quarter of 2022 than in the fourth quarter of 2021, with more than 154,000 jobs cut in the fourth quarter of 2022, according to the latest report from Challenger, Gray and Christmas.

According to Connie Whittaker Dunlop, founder of Monarch Consulting Group, which develops leaders, teams, and organizations through coaching and training, managers should know what to expect after a layoff. She notes that layoffs done wrong can incur additional costs of hiring and defeat the initial purpose.

The fallout from a layoff can be significant not only for those who lose their jobs, but also for those who remain employed. Companies that go through layoffs often find themselves with employees who are less trusting, less committed, and less satisfied, experts say.

According to a survey done in late November by BizReport, about 70% of “layoff survivors” say their motivation at work has declined since the layoff. Additionally, 66% of respondents report they feel overworked since the job cuts, and a third of those who survived a layoff believe that things will worsen for their company in the future.

When workers feel insecure in their jobs and experience higher levels of stress, some may choose to quit out of frustration. To prevent this, experts say leaders need to communicate the organization’s near-term goals and plans very clearly with front-line managers. By doing so, employees will feel more supported and be less likely to experience negative sentiments that could lead to them leaving the company.

As we move into 2023, it's important to stay up-to-date on the latest career trends. From 'quiet quitting' to 'loud layoffs,' employees are increasingly focused on 'career cushioning.' With job cuts on the rise, it's more important than ever for managers to know how to lead through layoffs.

"In today's business environment, leaders need to be able to show their teams how to accomplish more with fewer people," said Mark Dollins, president of North Star Communications Consulting. "This requires a focus on talent development in order to ensure that your team has the skills and knowledge necessary to be successful."

It is important to have a clear and compelling story about how the layoffs will help prepare the company for the future. This will help manage the change effectively.

Dollins said that this means giving employees confidence that the company is doing this for a reason, and that they will be in a better place after the restructuring or layoffs are complete.

An organization may "quietly hire" by acquiring new skills without hiring new full-time employees. This could mean that current employees temporarily move into new roles.

To avoid the negative reaction from employees who have already been through layoffs, experts say that leaders should make it clear what skills will be needed in the future and how employees can acquire them. Otherwise, they risk a public backlash from their employees.

According to Sam Caucci, founder and CEO of workforce training platform 1Huddle, workers are increasingly venting their frustrations on TikTok instead of in the breakroom.

Layoffs typically occur near the end of the fiscal year, as companies finalize their budgeting and planning for the coming year. Of course, economic conditions can always change, but giving employees a clear signal that the company is done with layoffs for the time being can help reset the stage.

Dollins noted that this creates a sense of "OK, now let's get back to work."