How to Boost Employee Morale After a Round of Layoffs

Read Recommendations from Wisq CEO Jim Barnett on Helping Employees Stay Productive and Engaged after a Layoff
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WISQ blog How To Talk About Layoff

A version of this article originally appeared on Fast Company.

I’m about to tell you something completely counterintuitive for hiring managers: With stock prices falling, a recession looming, and layoffs mounting, now is not the time to stop investing in employee happiness.

We are at a critical juncture where managers and HR teams need to consider how to help their surviving employees—the left-behinds—deal with the potentially debilitating aftermath of layoffs, numerous resignations, and economic uncertainty. We commonly think of layoffs as a cost-saving measure, but how we proceed after a downsizing event could cost us even more.

The price could be lost employee engagement, productivity and, ultimately, revenue.

Studies show that a whopping three-quarters of employees who survive a corporate layoff say their own productivity declined. They’re also more likely to leave; bigger layoffs produce bigger turnover spikes. Those who stay with the company might not feel engaged with their work in a meaningful way. As we have seen with the trend in quiet quitting, feeling burned out or overworked can lead to mentally checking out of a job.

You might think the left-behinds would be happy, even relieved, that they still have a job. But in reality, they are more likely to feel anxious about their future, guilty for “surviving,” and stressed because now they’re expected to do more with less, according to the research and training company Leadership IQ, which surveyed 4,172 workers who kept their jobs after a layoff.

How can you expect them to perform and deliver like normal when the circumstances have shifted so dramatically?

Fortunately, and unfortunately, we’re out of practice when it comes to nurturing employees during recessions and layoffs. Until recently, we enjoyed extended economic growth and a 52-year low in jobless claims.

I’ve seen several boom-and-bust cycles in Silicon Valley over the past three decades, and I’d say being a left-behind is exponentially tougher in today’s remote and hybrid work world, where an employee’s sense of inspiration, belonging, and connection to their companies and coworkers are already fuzzy, strained or nonexistent.

A recent study by BetterUp Labs analyzing 78 companies (about 3,000 U.S. workers) found that 43% of people don’t feel a sense of connection to coworkers, and 22% said they don’t even have one friend at work. More than half said they’d even trade some compensation for stronger ties with colleagues. BetterUp’s report, titled “The Connection Crisis,” also found that 69% of employees aren’t satisfied with available opportunities for connection in their workplace.

Certainly, we can do better. Here’s how.

Open communication

The absence of communication breeds disinformation, distrust, and poor performance. Be as candid and authentic as possible with employees about staffing changes. Also be transparent about workload changes, including whether newly assigned responsibilities are temporary or permanent.

Leadership IQ‘s survey of layoff survivors found that workers who gave their managers high scores for visibility, approachability, and candor were 72% less likely to report a decrease in their productivity. They were 65% less likely to report a decline in the quality of their company’s product or service.

Acknowledge survivor's guilt

Your left-behinds are mourning the loss of friends and worried about their own future at the company. Let them know their feelings of grief and anxiety are normal. Stay approachable and listen to their concerns.

After a round of layoffs, it’s important to relate to and connect with the team members remaining.

Foster friendships and mentorships

Even before the pandemic, workers were craving connection. Exacerbated by two years of social isolation, economic unease and geopolitical strife, societal stress is at an all-time high. It’s more crucial than ever to give employees explicit permission and space to socialize at work—for their well-being and your bottom line.

On-the-job socializing once was thought to hurt productivity, but stacks of studies now prove otherwise. Employees with workplace friends engage 32% more, collaborate 20% more, and are 32% more innovative, according to the BetterUp study. Research from the Harvard Business Review (HBR) and The Energy Project shows that “mini-breaks” and “micro-connections” that occur every 90 minutes result in a 50% higher level of well-being, a 50% greater capacity for creative thinking, and a 30% higher level of focus. Meanwhile, employees with few friends have 71% stronger intention to quit.

Fostering connections is especially challenging in a remote work world, so your creativity counts. Schedule virtual coffees or lunch meetups. Use your digital hangouts to spark new introductions and strengthen existing bonds over shared interests—hobbies, sports, kids, food, movies, music. I find the best virtual watercoolers are entirely separate from your productivity and workflow apps. When you allow employees to turn off work mode, they’re more likely to connect organically and authentically.

Give generous recognition

Acknowledge the accomplishments of both those who left and those who are staying. People want to be seen and appreciated, especially when they’re worried about their jobs.

Start meetings with shoutouts and then invite team members to share their own “gratitudes” for teammates. Be thoughtful and specific; a vague “nice job” compliment can sound insincere. Public and private shoutouts are equally valuable. If you sense that a particular employee isn’t comfortable with attention, send a personal email or note, or call.

Employees who feel recognized at work are twice as likely to put in extra effort and innovate, so a 15-second investment in a thoughtful compliment is totally worthwhile.

Help them find purpose

Remind your employees of the mission, vision, and purpose—the why of their work and specifically their contribution to the company’s greater mission. When you emphasize the “why,” you reinforce a sense of belonging, loyalty, and pride. Millennials, for example, are five times more likely to stay when they strongly connect to their employer’s purpose, according to a PwC survey of 2,000 employees and business leaders.

Talk about the value of your products and services, the benefits to customers or community, and how employees’ day-to-day efforts contribute. Employees are seeking value and purpose more than ever during this pandemic era, so help them see it.

The Bottom Line

Want to really save money during these wobbly economic times? Don’t ignore the needs of your left-behinds. Happiness, purpose, and belonging are no longer debatable attributes of an engaged and productive workforce—they are critical to your company’s future. In a time when certainty is rare, one certainty I guarantee is your employees will jump ship—if not now, then soon—if they feel left behind.

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