The steady stream of layoffs following the Great Resignation has spilled into 2024 with about 186 tech companies cutting over 49,386 jobs this year, according to Layoffs.fyi. Although the CEO outlook for 2024 remains positive about the deployment of artificial intelligence, business transformations and mitigating expenses, it has come at the cost of the workforce in the United States.
Although employers are making relatively smaller cuts this year by staggering them, employees have been impacted across a wide range of sectors, including technology, gaming, finance, retail and media. Despite their optimism, C-suite executives—with pressure from investors—are being cautious and remaining cost-conscious.
Companies were too ebullient and overhired throughout the pandemic and subsequently faced the consequences once the U.S. economy shifted out of their favor, with rising interest rates. The integration of AI in the workplace has enabled executives to downsize in certain areas and redeploy the savings toward investment into the fast-growing technology.
The challenge remains how companies can empathetically and respectfully conduct layoffs during these uncertain times.
Industries Seeing Layoffs
It is interesting to note that the job cuts are not just concentrated in one or two sectors. This suggests that there is an unspoken consensus among business leaders that they want to keep the firms lean and mean, especially once they realized their companies could survive with a scaled-back workforce.
In an interview with the Morning Brew Daily podcast earlier this month, Meta CEO Mark Zuckerberg shared the benefits he saw after reducing his organization’s headcount, “It was obviously really tough. We parted with a lot of talented people we cared about, but in some ways, actually becoming leaner kind of makes the company more effective.”
Zuckerberg’s peers in tech continue to be hit hard in 2024, with layoffs at Google, Discord, Amazon, Twitch, Unity Software, eBay, Microsoft, Salesforce, Flexport, iRobot, Paypal, Okta, Snap, DocuSign, Zoom, Cisco, Expedia, Sony, Bumble, Wayfair, Drizly and Rent the Runway.
Employees in media and entertainment face job loss, with rampant cuts at Paramount Global, YouTube, Warner Music Group, Pixar, Vice Media, Buzzfeed, The Wall Street Journal, Business Insider, Los Angeles Times and Sports Illustrated.
Wall Street masters of the universe have not been spared in the culling. Top financial services firms, such as Citigroup, Deutsche Bank, Morgan Stanley and BlackRock, have announced layoffs. Many of the impacted Wall Street professionals are from the back office, as top investment bankers have been relatively safe from job cuts.
After receiving large wage increases for drivers, UPS announced plans to eliminate 12,000 positions. Nike, Macy’s and Estee Lauder have also enacted job cuts this year.
Employer Mistakes When Conducting Layoffs
Losing your job can be a traumatic event. It’s especially scary as Americans face high inflation and living costs, a challenging white-collar job market, rising geopolitical tensions and an uncertain future. In light of this backdrop, it is essential for employers to offer empathy and understanding to ease the pain of a job termination.
When corporate leadership fails to have a cohesive strategy for both the company and the individuals impacted, it’ll create a pervasive culture of fear, stress and a declining morale. Even if your job is currently safe, you’ll be worried about what’s looming around the corner.
Dragging out the announcement, especially when workers have an inkling that something is going on, causes undue anxiety. Impersonal email blasts or generic public announcements leave workers feeling disposable. The attendant public relations disaster can harm the firm’s reputation and turn off potential top talent from thinking about joining the company. Giving vague or misleading explanations causes confusion and a lack of closure to the people who were let go and the remainers who survived the cut.
Adding insult to injury, some managers don’t offer the chance for people to voice their concerns nor answer any questions they may have, leaving a bad taste in their mouth. When the business doesn’t offer any severance packages, outplacement recruitment services or career counseling, it makes the organization look like it doesn’t care about its employees and the great things the laid-off workers accomplished during their tenure with the company.
Best Practices for Communicating Layoffs
It’s important for companies to handle layoffs with compassion, understanding and respect. Immediate managers should communicate to the impacted workers, demonstrating transparency, honesty and empathy throughout the process.
Employers should communicate the news to each worker and not hide behind announcements via one-way technologies. Allow employees the time to process what happened. Provide a forum for them to ask questions and be heard. If for any reason face-to-face meetings may not be feasible, ensure that there is a backup plan, such as an individualized video conference or personalized phone call.
Avoid using pompous corporate jargon. Plainly share facts about the layoff and why it’s taking place. Be prepared for both emotional and practical questions, as well as some anger and animosity. Some people dedicate their entire lives to their work, so they will understandably feel emotionally charged.
Many times, companies forget about those who survived the layoff. The workload gets transferred over to the remainers. With fewer people in the group, these employees feel overwhelmed and inundated, taking on the tasks of everyone who departed the company.
Source: Forbes
