Recently, the tech industry has drawn considerable criticism for this winter’s spate of layoffs. Microsoft, Salesforce, Meta, and other major organizations have responded to uncertain growth and the receding panic of last year’s labor shortage with significant staff reductions. Although this has been a dispiriting period for those affected, there have always been seasons of reorganization in any industry. Layoffs are intensely difficult for organizations, and there are virtually no leaders who would make the decision to let people go if it weren’t an economic necessity.
That said, it is vital that we develop respectful, sensitive processes during these shake-ups, ones that honor the dignity of released employees. While the media attention around restructuring and downsizing is unflattering, I would be less concerned with the public optics of these decisions than with the internal damage wrought by poorly executed layoffs.
For example, not even a week had passed before Elon Musk announced imminent layoffs to the employees of his newly acquired organization. When 3,700 Twitter employees—nearly 50% of the workforce—finally got word, it was by email, including the line “Today is your last day working at the company.” Perhaps Musk intended to send a message to shareholders and users that he was proactively protecting the social platform from excessive editorial oversight of content. Regardless of the motives, he seemingly spent more time announcing his intentions on social media platforms than communicating with his own workforce.
In the end, Musk’s actions created the impression that he was in an adversarial, destabilizing relationship with employees. When he followed the summary dismissal with the decree that his remaining staff “work long hours at high intensity” or leave, hundreds opted to depart. It is likely this was not the result he expected, given that he then attempted to persuade many of them to stay.
While Musk offers an extreme example of an insensitive handling of layoffs, he is far from the only tech executive guilty of missteps in management. More recently, Microsoft announced the layoff of 10,000 workers. On the night before the announcement, executives hosted and enjoyed a night in Switzerland, accompanied by a live performance from Sting. While not substantively linked to the economic health of the company, the poor timing of this event prior to the layoff announcement sent a message to the remaining tens of thousands of workers at Microsoft that leadership did not let grave decisions interfere with their entertainment.
In addition, Musk is not the only tech leader to employ the cold efficiency of remote layoffs via email. Meta recently released 11,000 workers—13% of its workforce—creating anxious vigils over inboxes, as reported by The New York Times: “Meta began notifying European-based employees of the cuts during their morning, with those retaining their jobs receiving emails just minutes after those who were laid off, three employees said. As the Silicon Valley headquarters began waking up Wednesday, employees described tense hours as people stared at their inboxes awaiting news.” While it is difficult to manage layoffs uniformly within a global company staffed by numerous remote workers, the more an organization takes the effort to manage these stressful departures more individually, the less alienated and expendable their remaining employees will feel in the aftermath.
In 2022, there was a 649% year-over-year increase in layoffs in the tech sector—97,000 compared to 13,000 in 2021. While 75% of those workers will likely find new (and often better compensated) employment, the sense of betrayal caused by the insensitive treatment of workers will persist long into the future. Easily avoided missteps affect engagement at work, retainment, and future recruitment. Communicating directly and frequently with impacted workers, avoiding public displays of indifference or antagonism, and devoting sufficient time to orchestrating changes within the organization can help to honor departing workers who have contributed to the viability of a business.
Compounding the problem of the ongoing layoffs is their relationship to poor hiring practices. Many of the employees recently released by tech companies had only been on the payroll for a year or so. Hired during the labor shortage, they may have been chosen as a stopgap rather than because they were the best fit. Regardless of the labor situation, recruitment should never dispense with prioritizing culture fit; hiring offers should always consider longevity. Putting aside training and replacement costs, poorly matched employees will be a drag on productivity and will inevitably be the first to go, likely leaving with resentment over their short-lived experience. Leading with respect requires setting people up for success. This starts with the interview process and may mean declining to extend an offer in the first place.
The tech sector has a reputation for disruption as a means of innovation. While arguably effective in the realms of research, development, and marketing, this aggressive attitude tends to fare worse when it bleeds into HR. It is important that we treat both livelihoods and human relationships with value, rather than viewing them as obstacles to progress. Workers remain the core of any industry. Compassion and respect amid volatility will go a long way in helping your business rebound from the inevitable shifts in the market.
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