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Fast Company: Leaders, Your Mass Layoffs May Have An Unintended Side Effect That Hurts The Company’s Bottom Line

28 Apr 2023
Companies may underestimate the extent to which layoffs affect those who survive them. Many good employees end up quitting.

Originally found at Fast Company

Over the past several months, the tech industry has been hit by mass layoffs at nearly every major company, including Meta, Google, Microsoft, and Amazon, to name a few. And just in the last week alone, Dropbox and Lyft joined the fray with significant staff reductions.

But while layoffs are usually done because companies believe that staff overhead is eating into company profits, a new study shows that layoffs may result in companies losing workers they want to keep around, too.

In the study, from the University of British Columbia Sauder School of Business, researchers looked at employment data for nearly a million workers across 1,620 stores. The stores belonged to a major retailer that was experiencing high turnover—or what the researchers call “human capital outflow.” 

 


Continue reading the original article at Fast Company.

Read the original research in Academy of Management Journal.

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