How Outplacement Services Can Help You Overcome the Hidden Cost of Layoffs
Studies show that new hires that undergo a structured on-boarding program are 58% more likely to stay with the company for at least three years. Clearly on-boarding is an effective and strategic human resources practice, but did you know that off-boarding has many important benefits for the company as well?
When layoffs occur, outplacement services ease the transition of former employees in addition to boosting the employer's brand and maintaining productivity amongst remaining employees.
Below you’ll learn about the hidden costs that inevitably come with layoffs and how an outplacement service company can limit the damage.
The Hidden Costs of Layoffs: Employee Morale, Productivity, and Turnover
Although layoffs are almost always seen as a way to cut costs, in the short term they can also cause serious problems.
It’s not so obvious because the numbers aren’t right there in front of your face. You probably don’t view your employees’ happiness in terms of dollar signs, so you may not notice that productivity drops when morale is low. Sadly, when layoffs occur, the displaced employees aren’t the only ones who suffer. Your remaining employees feel the pain one way or another, and these negative emotions inevitably contribute to poor productivity, a higher turnover rate, and increased absenteeism.
How your company handles layoffs can have a significant impact on your financial success. The cost of employee turnover can range from 30% to 150% of the displaced employee’s salary, and experts estimate that actively disengaged employees cost the U.S. economy as much as $350 billion each year in lost productivity.
Benefits of Hiring an Outplacement Service Company
When a company goes through a cycle of layoffs, it will most likely experience some negative kickback from the displaced employees, the public, and the remaining employees. Programs that provide benefits to former employees, however, can protect a company’s image. The best outplacement services show that an employer cares about their people.
After seeing their coworkers get let go, many employees feel scared for their own job security or angry with the company for practices they view as unfair. Having an outplacement services program can lessen those negative emotions, reminding those employees that the company is there to help them through the transition.
For more information on the best off-boarding practices, contact Frederickson Pribula Li, the top HR executive search and consulting firm in Silicon Valley.