Many of my clients have made, or are facing, the tough decision to downsize. My clients’ experience reflects the current state of the labor market. Forbes reports that layoffs are up 46% from August and 68% compared to the same time last year. Layoffs are often a recourse to downturns in profitability and critical business threats but could be perceived by employees as a breach of their trust. A reduction in force may be unavoidable, yet the way it is executed is completely within our control. Leaders can mitigate the negative impacts of layoffs to their remaining employees by offering a listening EAR (empathy, action, reprioritization).
Empathize With Employees
Layoffs are tough on all parties involved. Therefore, take some time to acknowledge your feelings, as well as what your employees are feeling. The way you manage your own feelings will set the tone for how you lead your team through the layoff. Empathetic leaders help people move through the rocky emotional stages that inevitably follow layoffs. By allowing people the time and opportunity to work through their emotions – even the negative ones, you’re increasing the likelihood that they will successfully progress to understanding and acceptance and ultimately be ready to move on.
What you can do:
- Increase in-person interactions with your employees. Physically showing up for your employees can help maintain trust while communicating candor and a sense of ‘we are in this together.’ Increase your visibility and adopt a leadership style that is founded in positivity and open, honest communication. Be open to impromptu conversations and fully listen for understanding. You are not expected have to have all the answers. If employees ask questions that you cannot yet answer, be honest, do some research, and commit to closing the loop when you have more information to share.
- Help your employees see how they fit into the organization’s future. Once you have increased engagement with remaining employees, the next step is to guide them through the transition and towards the desired future state. Help employees understand that changes are happening because the business is evolving and changes are necessary to carry out its mission and vision, not because the organization is trying to cut human capital expenses. As a senior leader, you can model one-on-ones with your frontline managers that help them understand how they personally fit into the bigger picture. You will also want to hold those managers accountable for having similar conversations with their employees. Research shows that productivity and profitability dip after a layoff, but organizations see better financial outcomes if employees believe the reduction in force was handled equitably and for strategic reasons rather than simply for cutting expenses.
When emotional reactions are left unaddressed or are addressed in a negative manner, employees fall into a state of distrust, detachment, and disengagement.
Act on Employee Concerns
The immediate actions you take following a reduction in force will be paramount to regaining the trust of your employees. Leaders can assuage negative sentiments by responding to the reduction in force swiftly and with the right course of action.
What you can do:
- Align your actions to employee reactions. Share updates with them as quickly as possible and be upfront about what you know and what you don’t. Share resources that will support the ‘whole’ employee, including their mental, emotional, physical wellness, as well as their productivity. In particular, provide support for well-being, the tools needed to do one’s job well, and career accelerating opportunities.
- Increase employee recognition. Offering meaningful recognition can be critical to re-engaging your workforce during a period of distrust. Seize formal and informal opportunities to recognize employees for extra effort and undertaking added responsibilities. Recognition can also be a vehicle for reinforcing your organization’s values and driving towards its desired future state.
Layoffs aren’t just emotionally taxing; they directly impact the physical well-being and daily work experience of your teams. In addition to their existing workloads, retained employees inherit the work of laid off employees to meet unremitting business needs.
What you can do:
- Review workloads with your employees regularly and frequently. Put lower priority projects on the back burner or remove them altogether. Ensure employees know it is ok to say, “Yes, at a later time” or “Yes, and that means something else needs to come off my priority list” in reference to requests.
- Determine if your organization needs to be restructured. Workforce transitions can create a natural opportunity to restructure your organization in alignment with your desired future state. Inventory your organization’s current and future needs, then match your employees to roles that meet your organization’s needs while balancing their skills and interests.
Leading through layoffs is not easy; you are tasked with balancing business outcomes and caring for your people. When downsizing is necessary it creates a tension between business needs and the needs of remaining employees. Employees will feel less supported and distrustful of the organization during this time. Give your employees the gift of a listening EAR—empathize with them, act on their concerns and reprioritize work based on your desired future state.
- Recession-proof Microsoft lays off nearly 1,000 employees across the company | Fortune
- Layoff Survivors: Coping When Coworkers Lose Their Jobs | liveabout.com
- The Feeling You Get After Surviving Layoffs Has A Name | HuffPost Life
- Primal Leadership, With Daniel Goleman | Ivey Business Journal
- A Better, Fairer Approach to Layoffs | hbr.org
- Job Cuts Surge 46% In September 2022, up 68% From Same Month Last Year; September Hiring Intentions Fall to Lowest Level Since 2011 | Challenger, Gray & Christmas, Inc. (challengergray.com)
- Layoffs rising as the U.S. economy slows | CBS News
- Layoffs On the Horizon? How To Lead Through a Reduction in Force | forbes.com
 “A Better, Fairer Approach to Layoffs.” Harvard Business Review, 23 Aug. 2019, https://hbr.org/2018/05/layoffs-that-dont-break-your-company