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Culture First with Damon Klotz
The Surprising Long Term Impact of Layoffs on Company Performance & Employee Experience.
Jul 18, 2024
Discover the profound long-term effects of layoffs on both company performance and employee morale. Key insights reveal it takes an average of 18-24 months for psychological recovery, potentially leading to trust issues and survivor's guilt. The importance of effective leadership and communication during these transitions is emphasized. Additionally, the impact of childhood development on workplace dynamics and discussions on gender disparities in leadership are explored. This enlightening analysis offers strategies for fostering a supportive environment post-layoff.
31:17
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Quick takeaways
- Companies can take 18 to 24 months to regain pre-layoff employee engagement levels, reflecting the deep psychological impact of job loss.
- Active recruitment of new employees can accelerate recovery by boosting morale and engagement, while existing staff may struggle with trust issues.
Deep dives
Long-Term Impact of Layoffs on Employee Engagement
The analysis reveals that following layoffs, companies typically take 12 to 18 months to return to pre-layoff levels of employee engagement. Current data suggests this rebound timeframe has extended to 18 to 24 months. During this transitional period, companies often experience an ongoing decline in engagement, with some showing five percentage points lower engagement at the 12 to 18 month mark. This increase in recovery time highlights the profound and lingering psychological effects of layoffs on employees, equating the stress of job loss to significant life events such as divorce or the death of a loved one.
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Discover
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