And in some ways, choosing to leave a company after a layoff is a prudent decision on the employee’s part.
The data supports this, with one study finding that even a 1% downsize can result in a 31% increase in turnover. And when employees are unsure of the security of their role, they will look for a more stable role elsewhere. This makes sense, because if an organization is in a difficult position, there are few reasons that an employee would recommend it to others. The largest differences are in an employee’s likelihood to recommend the company and to stay committed to the organization. Just as a company’s brand and reputation are affected, you would expect employee engagement to decline, but by how much? Unsurprisingly, engagement takes a hit after a layoff In other words, if a company with layoffs first surveyed in June 2021 and then again in December 2021, we compared them to the quarterly benchmark difference for that same time period. To have a control group, we compared each company’s change to the global benchmark for the same time period. Of these customers, 146 had conducted surveys before (Survey 1) and after (Survey 2) the layoff.īy comparing the results from the two surveys, we were able to understand some of the ways that layoffs affect employee engagement at organizations. Using Layoffs.fyi, Culture Amp’s people scientists identified customers who went through layoffs between March 1, 2020, and November 30, 2022.
Culture amp employee engagement series#
In the first part of our research series on rebuilding engagement in times of change, we share the latest data and insights on the impact of layoffs on employee engagement. With the possibility of a recession at an all-time high, many leaders will need to consider cost-cutting measures such as hiring freezes, budget cuts, and – unfortunately – layoffs. This makes post-layoff employee engagement a crucial consideration, both from a culture first perspective and a longer-term business strategy perspective. How your remaining employees feel is intrinsically intertwined with how your company will fare in the following months. Employee trust and morale typically plunge following any layoff, even when handled relatively compassionately. However, one area that deserves more attention is how layoffs can affect employee engagement among your remaining employees. A Randstad study found that after a layoff, 70% of companies reported a negative impact on future talent acquisition efforts, and 81% reported a negative impact on the brand.
Layoffs are never an easy decision, and the impact they have on your employees can’t be overstated.įor one thing, we know that a company’s brand and reputation can take a huge hit after a layoff.
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