With over 39,000 American mass layoff events during the Great Recession, December 2007-June 2009, corporate downsizing seems like an integral practice of modern organizational life (Bureau of Labor Statistics). Downsizing refers to the deliberate reduction of workforce size to improve organizational performance (Nair, 2008). Companies turn to downsizing, or layoffs, in hopes to reduce labor costs, increase profitability, or gain a greater competitive advantage (Maertz, C. , Wiley J. , LeRouge, C. , & Campion, M. , 2010). The question of whether downsizing is beneficial or detrimental to organizations has been debated. Supporters argue that downsizing allows companies to reduce overhead, decrease bureaucracy, enable faster decision making, and allow for smoother communication (Cascio, 1993). Additionally, with employee costs making up between thirty to eighty percent of administrative costs for an organization, reducing the workforce seems like an effective cost cutting measure (Cascio, 1993). However, those skeptical to downsizing argue downsizing brings “hidden costs”, such as the cost of losing skills and expertise as employees leave the organization and the turmoil the event of downsizing may bring to employees (Nair, 2008). Research sides with those who argue against downsizing, as layoffs often times make organizations more ineffective by failing to sustainably reduce costs, improve profits, or increase stock performance (Cascio, 1993).
In fact, on average, non-downsized firms outperform their downsized counterparts, with no empirical evidence supporting a relationship with increased financial performance and downsizing (Gandolfi, 2008). While, organizations do occasionally note an initial increase in productivity, with survivors working more competitively to retain their jobs, this increase is short-lived and unsustainable (Appelbaum, Delage, Labib, & Gault; 1997). There are several speculations on why the anticipated benefits of downsizing do not materialize, with research pointing to the lower affective organizational commitment associated with “survivor syndrome” as an explanation (van Dick, Drzensky, &Heinz, 2016). Survivor syndrome refers to the symptoms experienced by employees who “survive” a downsizing event and remained employed in the organization, and creates a set of emotions, behaviors, and attitudes that negatively affect both the employee and organization (Mayton, 2010). These symptoms include the survivor experiencing a range of emotions that fall into four clusters: fear, insecurity, and uncertainty, frustration, resentment, and anger, sadness, depression, and guilt, and unfairness, betrayal, and distrust (Nathan & Neve, 2009). The first cluster: fear, insecurity, and uncertainty, refers to the emotions related to the loss of control as the survivors have to face the instability of employment in their job. The cluster: frustration, resentment, and anger, relates to the emotions employees feel directed towards their organization, but are often suppressed as these emotions cannot be openly displayed at work (Nathan & Neve, 2009).
The feelings of sadness, depression, and guilt refer to emotions employees feel directed toward their laid off former coworkers. The cluster: unfairness, betrayal, and distrust, relates to the emotions survivors express towards the organization, when they feel that the downsizing was unjust and sudden. These emotions manifest themselves in behaviors where the survivor exhibits lower sense of wellbeing, decreased motivation, and reduced productivity (Brenner, Andreeva, Theorell, Goldberg, Westerlund, Leinweber, Hanson, Imbernon, & Bonnaud, 2014; Gandolfi, 2008; Nair, 2008; Rumlall, Al-Sabaan, & Magbool, 2014). While organizations tend to think downsizing would lead to grateful and hardworking, surviving employees, organizations do not consider that the process can be traumatic and lead to negative work effects (Lipton, 2016).
The sufferers of survivor syndrome, workers remaining following a mass layoff, are likely to display a lower sense of wellbeing, both physically and mentally (Brenner et al. , 2014; Jamal & Khan, 2013; Nair, 2008; Rumlall et al. , 2014). Well-being may be defined as an individual’s positive attitude related to oneself and refers to one’s state of physical and psychological wellness (Jamal & Khan, 2013). Following downsizing, the remaining workforce is twice as likely to develop stress-related illnesses, such as heart disease, asthma, and obesity, compared to companies who did not perform layoffs (Rumlall et al. , 2014). In addition to stress-related illnesses, survivors also experience other physical health symptoms like dizziness, faintness, pains in the chest or heart, and headaches, at a higher frequency than before downsizing (Amstrong-Stassen, 2005). Shreekumar Nair’s (2008) survey of survivor’s attitudes revealed that the survivor syndrome symptom of increased feelings of uncertainty, was a leading cause for the higher levels of stress and its subsequent health issues.
The symptom of stress is contributed to by, the increased workload, loss of relationships, and general organizational change, resulting from the decreased in workforce (Jenkins, 2012). In conjunction to the physical health issues related to stress, survivors also experienced mental health issues, often times manifesting as depressive symptoms (Brenner et al. , 2014). The instability and uncertainty associated with survivor syndrome is related to increased depressive symptoms, including melancholic mood, anhedonia, fatigue, and excessive worrying (Brenner et al. , 2014). While it may be argued that survivors are the “lucky ones” when companies downsize, as compared to their laid-off coworkers, both share the same increased likelihood of suffering from high levels of depressive symptoms. (Brenner et al, 2014). A possible explanation for this is that although, the outcome of employment is different for layoff survivors and layoff victims, both go through the same negative downsizing process. Both groups perceive downsizing as a painful chaotic event and as an experience where they lack control, two factors that help contribute to sense of depressive symptoms (Brenner et al. , 2014). In addition to affecting survivors’ personal wellbeing, survivor syndrome affects the wellbeing and profitability of the organization due to its influence on workers’ motivation and performance (Drzensky & Heinz, 2016; Jamal & Khan, 2013; Maertz, Wiley,LeRouge, & Campion, 2010; Malik, Saleem, & Ahmad, 2010; Rehman & Naeem, 2011; Travaglione & Cross, 2006; Waraich & Bharadwaj, 2012). Survivor syndrome’s symptoms of feelings of insecurity and betrayal contribute to the negative psychological impact on workers that can lead to decreased motivation at the workplace (Waraich & Bharadwaj, 2012). In addition, the increased workloads taken on by survivors, following downsizing, may decrease work motivation, as they now lack time to fulfill social and private obligations (Malik et al. , 2010).
Furthermore, although it seems logical that the fear of being laid off themselves would motivate survivors to work diligently and productively, survivors instead focus just on keeping their supervisors placated rather than completing work (Waraich & Bharadwaj, 2012). This thought process helps to explain the decrease in job performance experienced by survivors, as they are not motivated to complete productive work. Additionally, Drzensky and Heinz (2016) found survivors to decrease job performance as a direct response to an organization’s decision to lay off coworkers, especially when the decision is viewed as a voluntary action.
The symptoms of survivor syndrome, such as a decrease in sense of wellbeing, motivation, and performance, are related to reduced organizational commitment of the survivor (Jamal & Khan, 2013; Travaglione & Cross, 2006). Organizational commitment can be defined as the extent to which an employee identifies with the organization and can be split into three subtypes: continuous, normative, and affective (Linton, 2017). Continuous commitment can be understood as employees’ desire to stay with an organization based on personal investments made throughout the years of their employeement (Marques, Galende, Cruz, & Ferreira, 2014). Meaning, employees based their commitment to their organization on the cost it would be for them to leave. Normative commitment is defined by the employees’ feelings of obligation to the organization with employees’ commitment to the organization based on feelings of duty (Marques et al. , 2014). Affective commitment refers to the employee’s desire to be identified with the organization and is created by the employee’s involvement in and attachment to the organization based on intrinsic desire (Marques et al. , 2014) As compared to the other dimensions of organizational commitment, affective commitment is most associated to the symptoms of survivor syndrome as it is so closely related to the employees’ emotions regarding the organization.
Additionally, affective commitment of survivors was found to decrease following layoffs (Jamal & Khan, 2013). In fact, van Dick, Drzensky, and Heinz (2016) postulate that the reduced organizational identification of survivors following downsizing is the explanation for why survivors experience survivor syndrome. This suggestion is supported by the evidence that there is a decrease in surviving employees’ affective commitment following downsizing and that affective commitment has a positive correlation to well-being, motivation, and performance, side effects of survivor syndrome (Jamal & Khan, 2013; Lipton, 2016). Additionally, affective commitment also relates to other side effects consistent to survivor syndrome including employee turnover, organization citizen behavior, and absenteeism (Cassell, 2014). Employees who maintain a high level of affective commitment continued to feel valued as members of the organization and acted as greats assets for their company, rather than the negative effects experienced by survivors who suffer from lowered affective commitment (Lipton, 2016). Due to affective commitment integral relationship to survivor syndrome and effects on organizational effectiveness, it is important for organizations to strategize on how to maintain or increase affective commitment following downsizing to hopefully prevent survivor syndrome and its impact, from manifesting in the organization. In order to do so, organizations must consider what organizational factors are associated with a reduction of survivor’s affective commitment.
The decrease of survivors’ affective commitment can be associated with the breach of the psychology contract that occurs during downsizing. A psychological contract is an implicit, unwritten contract that is defined as the mutual obligation and reciprocal exchange agreement between the employee and the organization (Lipton, 2016). A breach of this psychological contract refers to when the employee perceives that the organization did not maintain one or more aspects of the obligations set forth by the psychological contract and is usually associated with feelings of unfairness (Lipton, 2016).
For example, if an organization’s communication to an employee during a change initiative lacked quality information or was limited in quanitiy, the employee would feel as if the psychological contract was breached because the organization did fulfill their obligation to provide clear and open communication (Lipton, 2016). In general, a breach of the psychological contract causes the employee to experience negative attitudes and behaviors, including a reduced sense of organization commitment (Lipton, 2016). If the survivor felt a loss of organizational support or a sense of violation of trust, from the psychological contract breach, the employee will disengage and lose interest in maintaining an identity with the organization (Lipton, 2016). In order to maintain balance following a psychological contract breach, caused by the organization not fulfilling its obligation, the employee with develop negative behaviors and attitudes in an effort to compensate (Paille & Raneri, 2016).
In conjunction to the psychological contract breach, reduction in affective commitment of survivors following downsizing can also be attributed to other organizational factors. Lack of transparency of the organization during downsizing and lack of clear explanation for the reasoning of the downsizing contributes to a decrease in survivors’ affective commitment (Nair, 2008). Additionally, perception of inadequate organization support, both in terms of sufficiency and availability, relates to decline in organizational identification (Travaglione & Cross, 2006). Following the organizational support theory, this is due to employees acting reciprocally to their perception of the organization’s concern for them (Travaglione & Cross, 2006). Meaning, if the surviving employees do not feel as if the organization provides adequate support during or following downsizing, they reduce their support for the organization and they decrease their affective commitment towards the organization. A reduction of affective commitment of survivors can also be related to the perception of unfairness during the downsizing process (van Dierendonck & Jacobs, 2012). If survivors viewed the downsizing process as procedurally unfair, their affective commitment is likely to decrease (van Dierendonck & Jacobs, 2012). This relationship can be explained by the survivor’s view and attitudes towards the organization changing based on how their laid off coworkers were treated during downsizing (van Dierendonck & Jacobs, 2012). With the relationship between affective commitment and organizational factors during downsizing apparent, organizations can implicate tactics to reduce downsizing’s negative impact on survivors.
In an attempt to reduce downsizing’s negative impact on survivor’s affective commitment, organizations can focus on maintaining a positive employee-manager relationship (Lipton, 2016). A positive employee-manager relationship can help mediate the effect downsizing has on the psychological contract. To maintain this relationship with survivors, employers should develop a sense of trust, by having managers express that they are receptive, competent, and receptive to the survivors’ needs (Paille & Raineri, 2015). This allows the survivor’s view of the organization to stay positive, reducing the effect on their affective commitment to the company (Lipton, 2016). Additionally, managers being viewed as trustworthy, allows survivors to come forward and discuss their individual concerns, strengthening their commitment to the organization (Lipton, 2016). In conjunction to trust, it is important for employers to display a sense of transparency to help reduce downsizings effect on survivor’ affective commitment. In Nair’s (2008) survey of layoff survivors, the majority (89%) of survivors surveyed said they would prefer a very transparent downsizing process, wanting management to meet with employees to work together on and discuss, the critical issues of downsizing. By doing so, employees feel more connected with management and the organization, positively impacting their affective commitment. Conversely, by not being transparent with the downsizing process, employers create an environment of distrust and helplessness, as survivors feel a lack of control over their professional lives (Nair, 2008). Managers can also utilize their relationship with survivors to promote employee engagement, reducing the effect downsizing has on affective commitment (Lipton, 2016). Employee engagement is an important agent of affective commitment because when employees become engage, they feel a return on the personal investment they put into the organization by finding more personal meaning in completing daily work tasks (Sinha & Trivedi, 2014). Managers are able to promote employee engagement and improve commitment, by regularly talking to survivors and monitoring their emotional states (Lipton, 2016). By doing so, survivors feel supported by their managers and that the organization cares about them both professionally and personally, causing the survivor to reciprocally care about the organization, increasing affective commitment (Lipton, 2016).
Organizations can also focus on providing support to survivors following downsizing in an effort to lessen the effect on affective commitment (Lipton, 2016). Employee perception of organization support has been associated with attachment and commitment to the organization (Kim, Eisenberger, & Baik, 2016). There are many ways in which a company can provide support to its layoff survivors, with training programs being a possible method (Waraich & Bhardwaj, 2012). Training programs allow survivors to feel supported while having beneficial information provided to them (Waraich & Bhardwaj, 2012). This information can include, job training and transition skills if the survivor has to take on new job responsibility to compensate for a reduction in workforce or experiences an increase workload, and personal change and stress management skills to cope with the process of change, survivors face during downsizing (Waraich & Bhardwaj, 2012). Organizations should also support survivors by promoting a culture of positive emotion expression (Mayton, 2011). This may include providing toxic emotion education, implicating “safe zone” where survivors can work outside the pressurized work environment for a time, and utilizing a third-party counseling team who can provide an environment of safe exploration of personal emotions (Gallos, 2008). Providing supports allows survivors to feel like their organization is “buying into them”, and they in turn reciprocate that buy-in by becoming more attached to the organization.
In an effort to maintain and increase affective commitment following downsizing, organizations should also promote effective communication between leadership and survivors (Appelbaum et al. , 1997; Lipton, 2016; Waraich & Bhardwaj, 2012). Communication is arguably the best way to improve affective commitment of survivors, with face-to-face interaction between the employee and manager being a commonly chosen communication method (Lipton, 2016). Promoting good communication is a valuable strategy in keeping survivors affectively commitment, as employees are unable to support an organization nor its decision to downsize, unless they are aware of what is going on (Appelbaum et al. , 1997). In fact, organizations should over-communicate to surviving employees as they need ample amounts ofinformation about the downsizing process to remain engaged in the organization (Appelbaum et al. 1997). During these conversations employers need to provide information honestly, consistently, and frequently, as reporting only the decision to downsize and the results of the downsizing, allows survivors to only speculate about the reasoning for the downsize and other related information (Appelbaum et al. , 1997). This speculation may lead to survivors viewing the decision to downsizing as vindictive and villainous, rather than the true reasons an organization chose to downsize for.
Organizations can also reduce downsizing’s effect on affective commitment by maintaining a high level of procedural justice during the downsizing process (Grubb, 2006; van Dierendonck & Jacobs, 2012). Procedural justice refers to the fairness of the procedure used when making decisions and has been shown to be positively related to survivor’s affective commitment (Grubb, 2006; van Dierendonck & Jacobs, 2012). This relationship is likely based on the idea that employees’ perceptions of fairness affect their feelings towards the organization (Grubb, 2006). Organizations can help increase the perception of procedural justice by ensuring that procedures are unbiased, consistent, ethical, moral, allow for the opportunity to correct or change decisions, consider the interests of all those involved, and use accurate information, following Leventhal’s (1980) dimensions of procedural justice. To maintain survivors’ perception of procedural justice and thus maintain their affective commitment, organizations should strive to base downsizing practices and decisions on these dimensions.
Due to affective commitment’s relationship to the onset and symptoms of survivor syndrome, it is imperative that organizations develop practices to maintain or increase survivors’ affective commitment following downsizing. Organizations can use the promotion of trust, transparency, employee engagement, organizational support, communication, and procedural justice to do so. While previous literature, as discussed above, has shown the relationships between those constructs and affective commitment, no research has been conducted studying the effectiveness of applying this knowledge into organizational practice in an effort to combat survivor syndrome. Though the wealth of knowledge exists, research is limited in the knowledge actually being applied. To address this limitation, a future study should apply this knowledge into a downsizing preparation program to prepare organizations to combat a reduction in survivors’ affective communication. This program should include two parts, a training specifically targeted at managers before downsizing and a developmental program specifically targeted at surviving employees during the downsizing process. The training targeted to managers should discuss methods of maintaining a positive employee-manager relationship, through the promotion of trust, transparency, and employee engagement, developing good communication, and creating a perception of high procedural justice. While the training targeted to survivors should be based providing them with organizational support, preparing employees with job related training if taking on new roles or job duties following the downsizing, and teaching survivors about the emotional support resources available to cope with the downsizing process. This program would utilize previous literature about the relationships between survivor syndrome, affective commitment, and organizational factors to create an applied method to reduce negative effects associated with downsizing.
Ultimately, the laid off workers are not the only losers when it comes to organizational downsizing. While, undoubtedly laid off workers may be the ones losing the most, surviving employees also experience the same emotional turmoil that is associated with downsizing, as well as face unique problems of their own. Surviving employees are not the grateful motivated workers organizations may expect to find following downsizing, but rather, ones suffering from reduced affective commitment, their resulting survivor syndrome, and the host of problems associated with it. It is imperative for organizations to prepare for the challenges facing surviving employees, if not only for the employee’s sake but for the company’s bottom line.