Companies are often forced to downsize by laying off workers. What does research show with regards to organizational culture and profitability after downsizing?

Question

Quizplus · Accepted Answer

Research shows that downsizing has negative effects on both employees and the company, and it often does not lead to long-term profitability. Downsizing can result in decreased employee morale, productivity, and loyalty, which can ultimately harm the company's bottom line. Additionally, the costs associated with severance packages and the process of downsizing itself can be significant. While there may be short-term gains in profitability, the long-term effects of downsizing are often negative.

Companies Are Often Forced to Downsize by Laying Off Workers