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March 05, 2022

Remaining employees suffer the most after downsizing: report

You can't open a newspaper or scan a web site with seeing another item about corporate layoffs.

And while downsizing is clearly devastating for those being let go, it’s the survivors that often have the worst time of it.

Quite often, the still-employed, who by all rights should be grateful for having jobs, end up resenting their bosses, hampering their performance at the same time.

If people are fired for cause, you can always rationalize that they deserved it. But when it’s an equally qualified peer, the typical result for those left behind is a lot of emotional baggage, including fear, uncertainty, grief, guilt and mistrust.

Workforce experts call it layoff survivor’s syndrome.

And why not? Fewer hands on deck means more work for those still around, which can lead to resentment, especially if the survivors don't feel the company is committed to their future and that they’re probably the next to go anyway.

It’s not as if all this is a secret. According to a recent study from the Human Capital Institute, most employers contemplating layoffs rank decreased levels of morale (71%) and reduced loyalty (62%) among remaining employees as their major hurdles.

The solution, HCI maintains, is an effective outplacement program that includes coaching and guidance from consultants; self-marketing materials; skill building and coaching; job leads and networking connections; and access to online resources.

Sounds good in theory ... unless you’re one of those on the receiving end.

What happened when you were shown the door? Or are you one of those dealing with survivor guilt?

By Gordon Powers, MSN Money



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Gordon PowersGordon Powers

A long-time fund company executive, Gordon Powers now heads up the Affinity Group, a financial services consulting firm. Gordon was a personal finance columnist for the Globe & Mail for many years, has taught retirement planning...

Jason BucklandJason Buckland

The modern-day MC Hammer of money, Jason can often be seen spending cash that isn’t his with the efficiency of a Wilt Chamberlain first date. After cutting his teeth as a reporter for the Toronto Sun, he joined the MSN Money team with...