Domino effect | How and why redundancies can trigger a torrent of resignations

Redundancies are an unfortunate fact of life in the volatile modern world.

Seemingly every week, headlines are rife with mass layoffs, firms going into administration and receding from major markets. However, these cuts, meant to tighten belts and streamline operations, might be setting off an unforeseen domino effect - pushing remaining workers towards voluntary exits.

Recent research has delved into the interplay between layoffs, employee morale and turnover rates. A study, recently published in the Academy of Management Journal, unveiled a stark revelation; company-wide layoffs were ten times more likely than voluntary quits to result in further resignations.

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The study, which analysed data from 1,620 workplaces over 22 months, discovered a pronounced trend among high-performing workers. Following job cuts, resignations among these employees spiked by 75% in the six months after layoffs were announced. The psychological blow of layoffs seems to create an atmosphere of urgency among workers, fuelling a race for the exit.