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Hasbro announced 1,100 job cuts on 11 December 2023, with CEO Chris Cocks citing market headwinds as “stronger and more persistent than planned.”
There is a bitter irony in a toy manufacturer being forced into layoffs just two weeks before Christmas, usually the strongest sales period for such companies.
But Hasbro is not alone. State Street, Zulily, Twilio, and Spotify make up December’s cohort of major redundancies, and 2023 has seen myriad layoffs across every industry, from financial services to eCommerce, each with a suitably vague corporate memo in tow.
Back in November 2022, whilst announcing plans for layoffs in 2023 at Meta, CEO Mark Zuckerberg stated that accelerated post-pandemic revenue growth “did not play out the way I expected.”
In January 2023, Spotify CEO Daniel Ek explained the first in a series of three rounds of redundancies by admitting he was “too ambitious,” and more recently, on 4 December 2023, Twilio CEO Jeff Lawson described a misplaced investment “bet” on growth. The list goes on.
Could HR do more to stop layoffs?
Where does the buck stop when layoffs such as the above take place? With the CFO and finance for failing to balance the books? With HR for overly aggressive hiring? The CEO and Board for making ambitious bets?
It’s never useful to point fingers, and each company will have its own set of circumstances. But HR can certainly take the past year as an indication of what can happen when their role is reduced to administrative. After all, is the responsibility of a talent acquisition team to blindly hire during growth, or to add meaningful input on where and when hiring should be fast, slow, or non-existent?
If we take these layoff announcements at face value, far too many organisations have a clear and consistent gap in their ability to plan and forecast hiring needs based on growth. HR can play a crucial role in bridging this gap.
Let’s consider a more positive story. In November 2022, CEO Tim Cook announced that Apple would be “very deliberate” with its hires. Thanks to this approach, Apple is the highest-profile tech company to have avoided layoffs (at the time of publication).
Examples such as Apple demonstrate that a more measured approach to hiring during periods of growth would help prevent organisations from making redundancies in 2024 and beyond.
Jane Datta, former CHRO, NASA, shares this rationale: “One approach for an organisation to take is to look at the range of projected growth, and add workforce more cautiously. Consider potential market disruptions that significantly change their projections.”
Datta also recommends diversifying growth. “Organisations should differentiate and plan growth with a mix of roles,” she continues. “Some will be continued in almost any scenario, which lend themselves to employment arrangements. Other roles that could be variable given market growth, company growth, and so on should favor contingent staff.”
But…it’s no mean feat
Of course, no one is expecting any business leaders to have a CV of tea leave reading and crystal ball consulting. This year has been economically tough on many organisations. Managers and leadership across all departments continue to face unexpected difficulties with budget, disengagement, and productivity. And nearly every business leader will be feeling the fatigue of unrelenting transformation and change brought on by factors such as AI, among others.
Predicting business needs months or years ahead of time is a fine art as much as it is a science, and it’s very rarely a productive exercise to play the blame game when things don’t turn out as expected. There’s also a case to suggest that many large enterprises are happy to go through shorter-term job booms and busts and trust that growth will steady over the longer term.
But HR leaders – many of whom will have joined the profession because of their passion for people – will be alarmed by the trend in layoffs and feel obligated to play a greater part in the battle for more steady, stable, and secure workplaces.
In Datta’s words, “While I am not naive enough to believe that any organisation can forever avoid layoffs, I do believe organisations can mitigate future layoff risks.”
No doubt those talent acquisition directors and hiring managers who led the rapid expansion of their company only to find their employees (and even themselves) the latest victim of 2023’s layoff trend will look at Apple’s steady hiring strategy with envy.
