As of late May, about 40 million people in the United States are unemployed, and the bleeding hasn't stopped. The numbers are staggering. Those who have lost their jobs are experiencing grief and many are struggling with identity. But this article is not about those who have lost their jobs. Rather, it's about those who remain-- the people who maintain their jobs after watching their colleagues get fired and furloughed. These are the "survivors", the "lucky ones". And there is a name for what these “lucky ones” are experiencing: Layoff Survivor Syndrome.

It's a real thing. Researchers have found that, "Actual downsizing and the threat of lay-offs have been repeatedly found to result in subsequent employee perceptions of job insecurity" (Probst, Stewart, Gruys, & Tierney, 2007). It is also noted that, “the reactions shown by survivors include emotions such as anger, insecurity, a perception of unfairness, depression, reduced risk taking and motivation, as well as low levels of morale” (Sahdev, 2004).  

Given the current economic condition, layoffs and furloughs seem largely unavoidable. Companies that have reduced their workforce are betting that the survivors will be the ones who not only help keep the doors open and the lights on, but who will help rebuild. Researchers Gretchen Spreitzer and Aneil Mishra say, "...the need to retain survivors with valuable skills becomes an important issue for downsizing firms" (Spreitzer & Mishra, 2002). In a research article called Surviving Downsizing and Innovative Behaviors: A Matter of Organizational Commitment, researchers state, "The outcomes experienced by those who remain – the survivors – are important for the future competitive capabilities of firms post-downsizing" (Marques, Galende, Cruz, & Ferreira, 2013). So, it's fair to say that these organizations are expecting much more out of their remaining employees. At first glance, this seems expected. So what's the issue? Unfortunately, these same employees--the ones these companies are relying on even more--  are likely experiencing emotions that are hindering their engagement. 

I’m going through this as we speak. At my company, I’ve seen many of my friends and colleagues furloughed. How do I reconcile my pervasive feelings of anxiety and job insecurity while remaining creative and productive? I turned to the research.

Research shows that an organization's response to downsizing--specifically how it communicates with survivors--plays a critical role in helping the remaining employees actually meet the organization’s post-downsize goals. "The way employers interact with survivors plays a major part in how employees deal with the period immediately after downsizing. Therefore, communication becomes an underpinning of the survivor syndrome remedy." (Appelbaum, Delage, Labib, & Gault, 1997). 

Thankfully, my company did a notable job in handling the furloughs. They called a town-hall at the very beginning of the work-from-home orders and were very transparent about their priorities and the hard decisions they’d be making. The CEO's message contained empathy for the leaving and the remaining employees, and he was the first to have his salary reduced and his bonus delayed-- establishing a sense of justice and fairness.

Researchers found that, "justice climate set by the organizational leadership plays an important role between the conduct of the leadership team and organizational performance," (Shin, Sung, Choi, & Kim, 2015). By communicating honestly and empathetically, and by reducing CEO compensation, my company set a “justice climate” that, as research says, "reflects the fairness of the outcomes resulting from the downsizing" (Brockner & Greenberg, 1990). Unfortunately, I think my company is in the minority. Even still, with my company doing many things right, why was I still filled with more angst than gratitude?

I determined it was the looming feeling of job insecurity. A downsizing is often a sign that a company has lost its footing and is searching for solid financial ground. Somehow, I had to find a way to stay creative and committed within an organizational environment of uncertainty. The research shows that, "Employees’ performance on the job, perhaps more especially in a technology and innovative firm, requires behaviors that foster innovation and the implementation of ideas which may be negatively affected by perceived employment insecurity, possibly due to a sense of powerlessness, the difficulty in accessing critical resources, additional workload or even corporate restrictions on using resources for innovation". (Marques et al., 2013). This resonated.

Call to Action

Layoff Survivor Syndrome is legitimate. You can be “lucky” to still be employed but also feel grief for your colleagues and uncertainty for your own situation. Knowing that these feelings are legitimate and unlikely to dissipate, what can leaders do to shepherd their employees and what can individuals do to navigate these uncharted waters? 

1. Leaders -- Don’t assume that layoff survivors feel good and grateful. After a downsizing, remaining employees often feel psychologically unsafe. If by some chance the downsizing was handled well, research shows that counterproductive behaviors and feelings may still be palpable with the remaining workforce, stemming primarily from job insecurity.  Be sure to build your team up; express gratitude for their commitment and performance during these trying times.

2. Leaders -- Allow your employees to take more initiative. Though economic unrest, workforce reduction, and organizational uncertainty may cause you to want to take more control, the irony is that empowering your employees is an antidote for disengagement and lack of morale. Allow your team the latitude to craft the “how” of their job, as you make clear the “what”. Create legitimate micro-goals with short time horizons for your employees to increase their sense of perceived control and to mitigate the lack of agency they have experienced.

3. Be generous and gracious. Amy Gallo in her HBR article What Your Coworkers Need Right Now Is Compassion quotes Worline and Caza, who say, "one of the most important things you can do right now is to be generous in your interpretations of other people." This is true given the fact that people are under enormous professional and personal pressure right now. Say please and thank you… and really mean it.

4. Pay attention to your stars, provide reassurance. Though this comes off as non-egalitarian, it is. There is evidence that when a work environment becomes unstable, top performers are more susceptible to look for stability elsewhere. You need top performers to stay… the survival of your organization depends on it. Appelbaum, Delage, Labib, & Gault state, "Management should talk to the “stars”, that is, the people who have the most job options outside the company, to ensure they know they are needed and that they have a future in the surviving organization" (Appelbaum, Delage, Labib, & Gault, 1997). High-quality performance and performers are not ubiquitous. It's important to recognize that and adjust accordingly. 

JOIN THE CONVERSATION

How are you dealing with Layoff Survivor Syndrome? Project Rework wants to hear from you! Share your experiences and feedback on the LinkedIn, or over email. If you learned something new today, share this article with a colleague or friend.

References

Appelbaum, S. H., Delage, C., Labib, N., & Gault, G. (1997). The survivor syndrome: Aftermath of downsizing. Career Development International, 2(6), 278-286. doi:10.1108/13620439710178639

Brockner, J.. & Greenberg, J. (1990). The Impact of layoffs on survivors: an organizational iustice perspective. In J. S. Carroll (Ed.), Applied social p.sychology and organizational settings (pp, 45-73). Hillsdale. NJ: Erlbaum

Frankl, V. E. (2014). Man's search for meaning. Beacon Press (MA).

Gallo, A. (2020, March 30). What your coworkers need right now is compassion. Retrieved from https://hbr.org/2020/03/what-your-coworkers-need-right-now-is-compassion

Marques, T., Galende, J., Cruz, P., & Portugal Ferreira, M. (2014). Surviving downsizing and innovative behaviors: A matter of organizational commitment. International Journal of Manpower, 35(7), 930-955. doi:10.1108/ijm-03-2012-0049

Probst, T. M., Stewart, S. M., Gruys, M. L., & Tierney, B. W. (2007). Productivity, counterproductivity and creativity: The UPS and downs of job insecurity. Journal of Occupational and Organizational Psychology, 80(3), 479-497. doi:10.1348/096317906x159103

Sahdev, K. (2004). Revisiting the survivor syndrome: The role of leadership in implementing downsizing. European Journal of Work and Organizational Psychology, 13(2), 165-196.

Shin, Y., Young Sung S., Choi, J. N. And Kim, M. S. (2014). Top management ethical leadership and firm performance: Mediating role of ethical and procedural justice climate. Journal of Business Ethics, 129(1), 43-57

Spreitzer, G. M., & Mishra, A. K. (2002). To stay or to go: Voluntary survivor turnover following an organizational downsizing. Journal of Organizational Behavior, 23(6), 707-729. doi:10.1002/job.166

Travaglione, A., & Cross, B. (2006). Diminishing the social network in organizations: Does there need to be such a phenomenon as ‘survivor syndrome’ after downsizing? Strategic Change, 15(1), 1-13. doi:10.1002/jsc.743