How to rely on Attrition instead of layoffs to reduce headcounts

varsha sarkar

August 18, 2023

4:07 pm

The common tasks done in the company include managing the workplace, hiring potential personnel, and motivating the workforce. No matter how large and powerful a corporation is, issues do arise occasionally. Employee attrition is one of the main issues that every firm, regardless of the industry, suffers from. The rising staff attrition rate needs to be managed with the right techniques and concepts.

Many firms have already started letting big numbers of employees go as the global economy continues to teeter on the brink of a recession. This trend is especially noticeable in the tech sector, where over 70,000 employees have been laid off in the last year by businesses like Google, Amazon, and Microsoft, among others.

What’s wrong with layoffs?

This tendency is obviously bad for businesses as well as employees, who could face serious issues as a result. In addition to the apparent fact that businesses firing employees may be in financial difficulty, layoffs and firings themselves aren’t ideal.

Keeping layoffs from being necessary

But, Will Daniel says in a piece for Fortune that organisations that prepare ahead of time may be able to escape the harshest effects of significant employee cutbacks by merely relying on attrition. The trend in recent months has been to use attrition rather than layoffs and firings, the author says. Cisco CEO Chuck Robbins told Bloomberg this week that his company is not planning to cut jobs, instead choosing to right-size using “the natural ebb and flow that you drive through attrition.” Video game publisher Ubisoft recently announced it would use what it called “usual natural attrition” to cut its headcount as a part of its $216 million restructuring plan.

But, while your organisation is still hiring and recruiting for other positions in other sections of the company, layoffs frequently just affect a division, region, or position. When your business fires some employees, it’s crucial to concentrate on keeping the rest of your workforce intact.

Overview of employee attrition

Under the ideal business environment, it would be able to retain its top performers for the duration of its careers, spending no money or time on lost productivity or recruiting. It is not about forced layoffs because they frequently turn out to be a blessing in disguise. The business would be better off without the office manager if he were to be discovered stealing any expensive items from the supply room. Employee attrition, on the other hand, is when workers willingly quit their jobs or retire and are not replaced, reducing the workforce as a whole.

Uncontrolled staff attrition has several negative effects, such as overall bad company performance, low employee morale, and in the worst circumstances, additional employee attrition. Due to a reduction in the workforce, remaining employees are forced to fill in where needed, often undertaking tasks for which they are underqualified or not fully trained. As a result, the personnel feel undervalued, underpaid, and overworked, which leads to higher attrition. Such circumstances might easily spiral out of hand and result in a mass employee exodus, which would make it impossible for the business to operate at a high level.

Keep an eye on your employer’s brand online

Recognize that while you cannot persuade departing workers to refrain from leaving reviews on Glassdoor or other employer websites, you can provide them with all they need to make a seamless transition to a new position, which can lessen the blow of being let go. Consider yourself the employee for a time, and do it with empathy. They might feel offended, resentful, bewildered, and unprepared. When you’re concentrated on the “how,” they are questioning “why.” Instead, of forcing them to pack up their desks, address their worries and give them time to ask questions.

varsha sarkar

August 18, 2023

4:07 pm

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