This week, it was confirmed that John Lewis is planning on cutting 11,000 jobs from its 76,000 workforce across the UK. News of the cuts made national headlines and whilst readers will be sad to hear the news, it’s largely unsurprising.
This is because headlines around huge slashes to headcounts are, regrettably, a part of modern life. Some industries have been hit worse than others. The tech sector, which took a beating in 2023, has continued to reduce numbers into the new year – however it seems that as a result of a rocky economy and much uncertainty, nearly all areas of business are perpetuating the same trend.
We’ve talked a lot, on HR Grapevine, about the cause of cuts, and the best practice when enforcing them is unavoidable. Yet one area that HR needs to get to grips with is still due some consideration; the effect on the remaining workforce.
According to research from My Perfect Resume’s 2024 Workplace Trends Survey, a massive 85% of workers are currently anxious about the prospect of losing their jobs in 2024. In addition to this vast number, 50% report feeling at least ‘a little worried’ and 35% say that they are ‘definitely’ worried. In short, the majority of your workforce don’t feel stable in their current role.
The outcome of job insecurity
The feeling that many employees are left with, when they see their colleagues being let go, is best personified by the term ‘sinking ship syndrome’ (otherwise known as ‘survivor syndrome’).
As the CIPD puts it, “survivor syndrome is experienced by survivors of a redundancy programme. Survivor syndrome includes feelings of guilt, job insecurity, fear and anger towards the organisation for being put in this position, essentially systematic from a perceived breach of their psychological contract. High levels of mistrust are often experienced between colleagues, but also towards the organisation”.
So, what effect are these worries having on your people, and therefore your company? To find out, we turn to more research conducted by BambooHR, which found that 56% of employees who feel layoffs are likely think about leaving at least once per month.
31% of employees have taken on some form of secondary employment outside of their full-time job, including part-time work (17%), freelance or contract work (16%), or a second full-time job (three per cent).
These statistics should be alarming. A significant proportion of the workforce who are not directly impacted by layoffs, but see them happing within their workplace are either actively considering leaving themselves, or looking to bolster their role with more security in the form of an additional job.
As you might expect, this has a huge impact on productivity, turnover, internal knowledge and, of course, wellbeing. It’s clear that when redundancy is rife within an organisation, it’s extremely hard for staff to focus on their own tasks and ignore the feeling that they may be next.
What can HR do to improve redundancy processes for remaining staff?
As ideal as not having to make job cuts is, it’s just not feasible. Redundancies can and will happen in the modern working world. But that doesn’t mean the issue is going away. So, what can HR do to ensure that the function is properly taking care of those who aren’t directly impacted, but are still psychologically affected?
The key here is open and transparent communication. As the CIPD’s description of survivor syndrome states, many will feel a sense of distrust toward their organisation. So, whilst you may not have all the answers, getting staff together and hearing their worries, and responding with as much clarity as you can is imperative.
BambooHR’s data states that 60% of employees say companies could ease layoff fears by sharing actions they're taking to avoid further layoffs, and 56% want transparency about why particular roles were let go. It’s clear that staff don’t feel that they’re being kept in the loop in these challenging situations.
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Similarly, companies should embrace the ‘why’ of the situation. This means giving staff clarity on the financial stability of the company, its roadmap and future plans, and the actions and consequences that led to needing to reduce headcounts.
This does admittedly mean being honest about missteps or errors that the company has undertaken. This is likely an anxiety-inducing prospect. However, staff inevitably become aware from the organisation’s actions that something has gone wrong. It’s better to be open and truthful about this, than let them speculate and perpetuate rumours.
And finally, consider some outcomes. Listening and fostering a clear line of dialogue with staff is great but it does need to lead to some change or greater awareness at strategy level. This could be committing to increased company-wide townhalls whilst disruption continues, and ensuring staff that they’ll be kept in the loop in an organised fashion. Or, it could mean offering support, such as mental health benefits, whilst staff feel psychologically insecure.
Ultimately, through active engagement, honest dialogue, listening to staff’s worries and offering clear outcomes, there’s a lot that HR can do to ensure that the unfortunate necessity of redundancies doesn’t cause an internal crisis.
Yes, it’s an unpleasant process which is wrapped up in personal circumstance and emotion, but that shouldn’t put staff in jeopardy of a mental health crisis and nor should it lead to a wave of resignations, as staff search for some stability.
Above all else, remember that you’re dealing with complex humans, all of whom find something essential within their roles, whether that be personal purpose, or financial security. Treat people like complex humans, and the process will be much easier.