What Employers Should Know About The Trauma Of Layoffs

Building employee resilience in turbulent times

You can’t avoid the headlines. Every day there’s another announcement of layoffs. It’s not surprising—economies ebb and flow—but the past three years have been especially chaotic. While some businesses thrived, others closed, reduced headcount, or struggled to hire. While unemployment decreased over time, pay hasn’t kept up with inflation. And now there’s talk of a looming recession.

What does this weird mishmash of good and bad news mean for employees? Confusion, chaos, and, most definitely, a lack of confidence that their jobs are safe. Even if your industry is hiring, your employees may be wondering when the tide will turn.

Many of us have been through economic downturns. I’ve been through a few. In 2001, I was working for an airline. When airline travel decreased after 9/11, I was part of the mass layoff we were all expecting. During the 2008 recession, I was working in healthcare. The organization I worked for told us their goal was not to lay off anyone. And, to their credit, they didn’t. However, that didn’t mean things were good. All pay increases were put on hold. Open positions went unfilled. We were asked to “be a team player” and take on additional duties. Morale dropped. For the most part, we told ourselves to just be happy we had a job, and we stuck it out because there weren’t many other options out there. So, we muddled through, commiserating with each other after meetings trying to determine if there was anything left unsaid.

Getting laid off after 9/11 was hard. But once it was done, it was done. The ongoing wondering in 2008 meant waiting and waiting. And like Tom Petty once said, “The waiting is the hardest part.” Just because we were still employed, didn’t mean everything was fine. After the economy leveled out, we still struggled. It took a while before any raises were implemented or jobs were refilled—some weren’t, so the extra duties were no longer “extra,” just more work for the same money. We knew a lot of others who had lost their job, so we felt we needed to be grateful that we had jobs.

Our leaders wanted us to carry on, push forward, and most importantly, not talk about the hard business decisions that were made or the pain those decisions caused. The struggle was real, but the stark reality wasn’t acknowledged out in the open. As a result, we continued to feel anxious, confused, insecure, and distrustful.

At the time, we wouldn’t have referred to the mere prospect of a layoff as a “traumatic event.” But it was, and it is. Trauma is an emotional response to a distressing experience. And a layoff is most certainly distressing. It can cause deep and widespread psychological harm affecting people and their work long after things return to “normal.” Employees can perform at their best when they’re preoccupied with “what-ifs” and constantly burdened by compounded stress. People overwhelmed by worry are less likely to be productive and more likely to make mistakes.

To help their people be successful, leaders need to be ready and able to support their employees before, during, and after a layoff. Let’s examine how you can support your employees throughout its duration and help them process their emotions in the aftermath.

Preparing for Layoffs

First, you must build trust with your employees when business is good. If you don’t start from a place of trust before a layoff, it will be difficult to establish it when you are in the middle of such a stressful, chaotic, and challenging situation. To create relationships built in trust, act with transparency, clarity, and consistency. Demonstrate that you care personally for your people. Be sure to show them the trust that you want them to show you. The healthcare organization I worked for had spent time prior to the recession building trust with open communication, so even though we were worried and wondering, we believed that our leaders were at least sharing what they could.

Second, plan for trauma. You may already have plans in the event of emergencies, disasters, or major business disruptions. You likely do not have a similar plan for layoffs. However, some of the same communication skills you will use during other emergencies can be utilized during a layoff. Part of your supervisor training could include how to have difficult conversations and how to project confidence when the future looks bleak.

Make sure this training covers the emotional state of employees during and after a layoff. Go over the signs of distress managers should recognize and help them understand what is and isn’t in their power to manage. Emphasize the importance of transparency, clarity, and consistency. Managers acting chaotically can make matters worse.

Third, establish a communication plan so employees know where to go for up-to-date information. This plan should include how to get information to employees about the layoffs before they hear about it from someone else and to whom they can go with their questions.

Navigating the Trauma of a Layoff

When I was laid off after 9/11, social media wasn’t what it is today, and neither was video conferencing. I knew the layoff was coming because the company had been up front and clear about the decisions that were being made and when we would hear from our supervisors. They used email to share updates that were meant for all employees and phone calls for individual updates. Knowing what to expect made the entire process more bearable – it still sucked, but it helped.

When the moment comes to conduct a layoff, you may feel panic. That’s okay. Take a moment to breathe and calm yourself. Bring your team together. Outline what needs to happen, including communications that should go out to employees. Make sure everyone is on the same page. Consider how the news will be delivered to people working different shifts.

When it comes time to break the news to employees, meet with them individually and, if at all possible, in person. Word will get out, and you want to be sure your staff hear the news from the right person, not other employees, or worse, social media.

Be sure to act with empathy and sensitivity to those who are most affected. Sometimes, well-meaning leaders emphasize their own pain at a time when their employees are hurting. Less well-meaning leaders sometimes act in callous or dismissive ways, treating their employees as if they are disposable. Both of these approaches can create additional stress. They also have a chance to become viral news online, which isn’t good for you or your organization.

Responding to Trauma When Things Calm Down

When the dust settles, you may be ready to return to “normal,” but that’s not going to happen. Your employees’ world has changed. You need to help them adjust to this “new normal” and recognize that the past isn’t coming back. While those who still work for you may be grateful to still have a job, many will also have “survivor’s guilt.” They feel bad for their colleagues and friends who have lost their jobs, and they may feel a little resentful of the extra duties they now must take on.

Your employees will need time to process the event and their feelings about it. Share information about your employee assistance program (EAP), if you have one. Create spaces for employees to connect and talk about the changes. Prepare managers to listen, without comment or excuse. Encourage your managers to be highly visible, approachable, and candid about what you’re doing to rebuild trust with your employees.

Going back into the office after a layoff is uncomfortable—for everyone. I remember going into the office in 2001 for the last time to turn in my equipment and ID badge. The space was completely empty except for my former supervisor. As we said goodbye, she said “Well, I suppose this is the last time we will see each other.” She was right. I knew bosses had to have this conversation a lot during those weeks, waiting for those laid off to bring their company property back, while she sat alone in that space. What I didn’t think about was what she was probably going through, having to say goodbye to people she had worked with for years, people she had watched grow in their careers. Was she given the support she needed to move through that? I don’t know. Back then, she would have been encouraged to be a “team player” and get “over it” quickly. We must do better for our employees because we know better now.

We cannot shy away from the events we all collectively went through. We cannot sweep trauma under the rug and pretend distressing events didn’t happen. Being upfront and honest about the experience will be a huge benefit to your employees working through their experience and what it means to them. Trauma will always get its say, but it doesn’t have to have the last word.

This article was authored by Wendy Daily, and was originally published on July 25, 2023 by HR.com.