Leading through layoffs: maintaining employee engagement

As U.S business leaders reach the summit of 2020, infinitely diverse obstacles await on the other side. A year of battling volatility and uncertainty caused many to begin the ascent with vastly reduced teams, when 29% of firms restructured. For others, team restructuring took place in piecemeal along the way, or has only just begun as all other options were explored and exploited.

For all, the path forward relies on encouraging, motivating, and cultivating the continued dedication of the remaining workforce.

True leadership is required in moments like this. Layoffs can wreak havoc on employee engagement and brand perception for years, especially if the process is mishandled. To manage through these transitions effectively, a commitment to humanity, decency, transparency, and communication is necessary. Leaders must understand the negative effects that layoffs can have on remaining employees, and they need to mitigate against fall out through a cohesive, coordinated, and well-communicated strategy.

Understanding the fall out of layoffs

According to a study highlighted in an article by Radhika Phillip for Forbes, researchers found that layoff “survivors” exhibited a 36% decline in organizational commitment, and a 20% decline in job performance. Another recent study by Leadership IQ of more than 300 companies and over 4,000 employees that experienced layoffs in 2020 stated that 74% of employees reported a decline in their own productivity, and 87% are less likely to recommend their company as a good place to work. This same study found that 69% of employees believe that the product or service provided by the company has declined since the layoffs, and 77% see more errors being made. 

Experts agree that these numbers can be attributed to an overall loss of employee morale, stress, loss of control, and lack of reassurance. According to research by John Hackston, featured in an article by CNBC, as much as one-third of remaining employees can experience the phenomenon of “survivor’s guilt,” and often grieve the loss of their laid-off co-workers, while wondering how and why they were spared the same fate. Staff perception as to how fairly layoffs were handled contributes to levels of retention, trust, and loyalty. 

While many employees are relieved to have kept their jobs, especially during unprecedented layoffs globally, workload additions after staff reductions can rapidly reduce enthusiasm. If roles and responsibilities begin to blur without direction and expectation, tension is likely to increase between the employee and leadership, and often between teammates. During a time when so many unplanned adjustments have taken place and continue to do so without end in sight, it is critical that companies provide guidance and counsel to employees regularly. 

7 guidelines for maintaining employee engagement through layoffs

Without a vigilant approach to transparency, the opportunity to lead through layoffs will be lost. Here is a list of “tried and true” guidelines for maintaining loyalty and engagement after layoffs:

1. Start by issuing a statement of condition and purpose

This statement is a necessary step, and without question, timing is everything. As soon as possible, a clear, honest, and compassionate message containing the following should be disseminated:

  • An explanation of the conditions that caused the layoffs
  • The overall current state of the organization considering these conditions
  • A reassuring statement of purpose and planning
  • A clear, concise overview of short- and long-term goals for the company
  • Reassurance that guidance and support will continue to be provided as roles and teams shift.
  • A request for feedback and an opening of communication lines with links to specific pre-designated tools (i.e., surveys, idea boards, etc.), and contact information for chosen HR and other leaders identified to assist in helping employees through the transition
  • Introduce next steps and expectations and instill trust by committing to continued communication and transparency as challenges arise and progress is made

2. Open lines of communication (and keep them open)

If ever there is a time for open doors, one-on-ones, feedback systems, team focus groups, and presentations from leadership, it is now. Employees should feel confident that feedback will receive recognition of receipt, and response in a manner that is feasible and timely. According to the aforementioned Leadership IQ study, layoff survivors who gave their managers high scores for “Visibility, Approachability and Candor were 72% less likely to report a decrease in their productivity and 65% less likely to report a decline in the quality of their company’s product or service.” According to Gallup, “When employees strongly agree that their manager provides meaningful feedback to them, they are 3.5x more likely to be engaged than other employees.”

3. Break the ice to break down silos

The disruption of teams and working relationships is likely to cause a considerable amount of stress and uncertainty. To add to this, reconfiguring teams to work together in ways that they were not previously required may be awkward and slow-going if not facilitated. Thoughtfully planned icebreakers that allow teams to engage without immediately tackling projects can increase communication and trust. Especially after layoffs, employees may be hesitant to build new bonds. It is important to encourage connection through unique, enjoyable interactions and even more important to find creative ways to do this for remote teams.

4. Share progress, admit challenges

Employee loyalty and trust is gained through reliability and increased transparency. After layoffs, it is advisable to control the story and administer information frequently. To lower employee stress and concern, it is important to continually share any progress made toward the goals outlined in the original statement of purpose and direction.

However, much like progress, leaders should continue to be honest about challenges and involve teams as early as possible to be a part of the solution. Failing to admit challenges or informing employees too late has an adverse impact on trust and loyalty, and it retraces steps toward employee engagement and innovation empowerment.

5. Share and celebrate success (both individual and overall)

In difficult times, any chance to recognize contributions and celebrate success should be taken. According to a recent Gallup study, employee recognition has been found to increase retention by increasing loyalty, engagement, and productivity. A compilation of recognition-focused statistics published by Bonusly states that “70% of surveyed employees believe that motivation and morale improve ‘massively’ with managers saying ‘thank you’ more.” This same article notes that 85% of employee respondents believe that good work should be spotted and recognized “in the moment,” and nearly the same amount believe that this can happen continuously throughout the year.

To maximize the impact of any success, be sure to share recognition and make announcements both externally as well as internally. One of the best ways to preserve and bolster brand dedication among employees and customers is to show how dedicated the brand is to both in return. 

6. Offer upskilling opportunities 

Employee engagement has been proven to increase when upskilling opportunities are offered within their organization. According to a survey of 400 full-time workers by TalentLMS and Workable, “66% of employees ranked the joy of learning new things and developing new skills as the top upskilling motivator, while 80% of employees say that upskilling/reskilling training has boosted their confidence.”

This is a win-win for employee and employer: one regains a feeling of control over personal progress and value, while the other gains a more engaged, satisfied employee with an additional applicable skillset.

7. Rinse and repeat all of the above … unwaveringly

Written by Vaco contributor Angela Fisher
Angela Fisher is a seasoned experiential strategist focused on project management and partnership development. She is the founder and co-owner of Populate Productions, a North Carolina-based event and media production agency. Angela is best known in the Triangle area for designing experiences that draw thousands of new customers to mixed-use developments and downtown businesses.


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