Generally speaking, the biggest impact of downsizing on the employees that remain is a significant loss of morale. It’s hard to worry about being next, particularly if the lay-offs seem random. At a certain level, large scale lay-offs re-introduce the notion that we don’t work in a meritocracy (where merit and hard work are always rewarded), and that’s an idea that many of us try to keep at bay so that we can sleep at night.
For managers, after a lay-off, it’s a particular challenge to structure the work lives of employees so that they are reassured.
DOWNSIZING. Restructuring. Headcount reduction. Whatever they are called, layoffs instill dread, guilt or both in managers. The loss of a job is among life’s most traumatic events, and even many hard-nosed managers hate to force that experience on their colleagues.
Because of this, managers can become so consumed by the prospect of firing people that they fail to adequately reassure and remotivate the employees who remain.
But they make this mistake at their peril. Study after study has found that employers who eliminate jobs may not bolster productivity over the long run. Too often, their anxious and overworked remaining employees become risk-averse and unproductive, or leave for other jobs. As companies hire new workers or turn to outside vendors to compensate, the short-term savings from layoffs can evaporate.
After a downsizing: How to motivate? explores exactly how you can reassure current employees that their jobs are safe so that they can continue to work.
The problem, of course, is that often you cannot reassure them of this truthfully.
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