Sponsor content: How HR can center culture amid layoff fears

Company layoffs were a prevailing HR headline of 2023, and the same looks to be true this year, as scores of big-name organizations reduced headcount since the start of the year.

Already, companies like Amazon and UPS have announced rounds of job cuts—and they aren’t alone. Recent research from Randstad RiseSmart found that more than 90% of business leaders surveyed expect to downsize to some degree this year. While layoffs may help an organization’s bottom line in the short-term, job cuts—or even employee anxiety over the potential threat of them—may have long-term implications for company culture, experts say.

“The cruel fact is that sometimes layoffs are a necessary part of business,” industry analyst Josh Bersin wrote for HRE. However, Bersin cautions, HR needs to be a strategic partner in determining whether layoffs are necessary and, if they are, how to keep culture front and center both during and after job cuts.

“It’s our job in HR to help company leaders consider important questions and potential scenarios—in good times and bad,” Bersin says.

Preserving culture through layoffs

As layoffs gained steam in the last year, plenty of examples cropped up of organizations that may not have strategically considered the cultural impact. For instance, the Los Angeles Times came under fire for a mass layoff conducted through Zoom, while many employers are feeling the pressure of the growing TikTok trend “Get Laid Off With Me,” in which workers record and share the moment they receive the news of their job loss.

Before such news is delivered, employers can be working to protect culture, says My Perfect Resume career expert Kellie Hanna. She advises HR and business leaders to remain as transparent with their workforce as possible about the organization’s strategic workforce planning and if layoffs are possibly coming down the pike. When they are, empathy must be the priority, she says—both for those losing their jobs and workers retained—if organizations want to sustain a culture that centers employee needs.

layoffsThat’s a strategy that can continue into the post-layoff phase, as leaders actively recognize the “survivor’s guilt” many retained employees feel, she says.

It’s a feeling that is exacerbated by employees’ own fears about their job security.

After a layoff, Bersin notes, “surviving employees feel uncertain and demoralized and often end up being overworked. It can take years for a company to recover from a layoff—and some never regain their footing.”

In fact, according to research published in Forbes, job satisfaction among survivors declines by more than 40% after a layoff, along with impacts to company loyalty and job performance. That’s where a strong culture can come in, experts say.

For instance, employers that make employee recognition an expected cornerstone of a people-centric culture can soften the blow of layoffs on existing employees. When they receive regular recognition, employees will better understand their value and role in the organization, which can build trust moving forward from a layoff.

“Embracing the human element that occurs following layoffs with communication and recognition rather than denying the difficulty is what will ground and unite your organization’s culture and keep it moving forward,” researchers from Workhuman wrote in a recent white paper.

What’s more, investing in employee recognition can even help employers protect their bottom line—to prevent further layoffs. Workhuman research found that large employers, with at least 10,000 employees, could save more than $16 million by strategically investing in employee recognition.

“With a recognition-centered approach that incorporates measurable ROI insights into the growth of your organization,” researchers write, “you can strategically save money while building culture.”

Learn more about how to preserve culture through layoffs in Workhuman’s white paper, The Impact of Layoffs: Employee Sentiment and Cost Implications.