Employee productivity skyrockets at firms that downsize repeatedly because the remaining workers want to be sure that they are not the next to be let go.

Question

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This statement is a common myth, but research shows that repeated downsizing or layoffs often have negative effects on employee morale, job satisfaction, and productivity. The remaining workers may feel anxious, stressed, and overworked, which can lead to burnout, health problems, and turnover. Additionally, downsizing can result in a loss of valuable talent, knowledge, and institutional memory, which can impair long-term competitiveness and innovation.

Employee Productivity Skyrockets at Firms That Downsize Repeatedly Because the Remaining