Smith Brain Trust / May 11, 2023

How to Handle Worker Concern About Layoffs

How to Handle Worker Concern About Layoffs

It’s been yet another week of mass layoffs. Tech is still leading the charge with LinkedIn, Intel and Novavax firing hundreds of people. Twenty-five percent of the staff at Paramount Global, which includes Showtime and MTV Entertainment Studios, are being let go. We will reportedly continue to see layoffs as an uncertain economic outlook continues.

This has many employees on edge, wondering if their job will be next on the chopping block. A recent survey finds 35,000 workers, more than a quarter of those in the U.S., fear they’ll be laid off. The Wall Street Journal reports many managers know little more than their employees about what lies ahead on jobs, but despite that, should be upfront about what they “do and don’t know” when talking to employees nervous about job security.

University of Maryland Robert H. Smith School of Business Associate Professor Trevor Foulk says, “if a CEO is in a position to assure people there won’t be layoffs, they should. However, saying there won’t be any and then laying off workers is about the worst possible case scenario.”

Foulk, whose research includes the study of workplace power dynamics and social perception, advises “if layoffs are coming, or if a CEO is unsure they are, one thing the boss can do is emphasize what they’re doing to avoid it.” For example, they can say nothing is guaranteed, but highlight all the steps they’re taking to keep layoffs from happening. This might include “strategic initiatives aimed at increasing revenue or cost-cutting measures like no longer providing free coffee in the breakroom or even more importantly, suspending executive bonuses and other perks.”

Managers should underscore that layoffs are a last resort and that job losses will occur only after other options have been exhausted.

Workers who are worried they may be laid off can be less productive. When bosses are keen on ensuring employees know they’re on their side, Foulk says “it can help keep them focused, understanding that their efforts aren’t wasted. In other words, if the CEO is working hard to save their jobs, maybe they can work hard too.”

He points to research that shows when bad things happen, people are okay with it if they feel like what led to the outcome was fair and just. “Obviously, workers won’t be happy about losing their jobs. But, they’ll understand it better than if they’re kept in the dark about what caused the layoffs.”

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