Your Coworkers Got Laid Off. How Do You Feel?
Company culture may not recover from a mass layoff
Work-life balance ratings have dropped sharply at companies that underwent a large wave of layoffs recently.
Ratings for diversity, equity, and inclusion have also declined at these companies, likely as a result of a large outflow of DEI professionals.
Employees that survived the layoff waves at these companies associate them with uncertainty, anxiety, and a decline in morale.
In our recent collaborations with Rani Molla at Vox and with Business Insider, we revisited the occupations most overrepresented in the Tech Layoffs. Previously, we reported that recruiters were the most overrepresented occupation in layoffs in 2022, but the tide has turned, and engineering roles are taking the brunt of the latest wave. With layoffs spreading to the core business of tech companies, it’s worth asking: How do employees feel about their work after their coworkers have been laid off?
Tracking employee sentiment at companies with large layoffs reveals a clear pattern: employees feel the added burden of missing coworkers. Here, Revelio Labs measures a company’s level of exposure to layoffs by the number of laid off employees relative to its total headcount, restricting our attention to companies that experienced layoffs in the past year. In the immediate aftermath of layoffs, companies with high exposure to layoffs saw a drop in work-life balance ratings relative to companies with fewer layoffs, our data analytics software tools show.
As we’ve previously reported, companies going through layoffs have been disproportionately losing their DEI workforce. Perhaps unsurprisingly, Revelio Labs finds that DEI sentiment at companies with many layoffs also takes a hit in the immediate aftermath of a wave of layoffs.
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Our previous newsletter also found that companies with DEI teams experience higher levels of employee satisfaction with culture and values. We thus see a large impact of the DEI exodus on the culture and values scores at companies with high exposure to layoffs.
What drives these changes in sentiment? Using our data analytics software tools to examine text reviews of employees mentioning layoffs, we see a general sense of uncertainty, anxiety, and declining morale among the employees who weathered them. Here are the words that remaining employees most closely associate with layoffs:
