'Make sure there's ... a channel, almost for mourning'
Study: Layoff survivors' lament
By Porter Anderson
(CNN) -- "What I've seen is that there's much more focus on the people getting laid off than on the 'survivors,' as we call them."
Marc Detampel is a senior manager with Andersen. Formerly Arthur Andersen, this business-services corporation works with companies in 84 countries in consulting, assurance, tax, corporate finance and legal issues.
"For those being laid off," says Detampel, "there are severance plans, there's outplacement, there's counseling, there's communication, there's talk about a 'soft landing.' But for the rest of the corporate population, the survivors, there's almost a philosophy that says, 'Hey, they'll be happy just because they still have the job.'"
When Andersen teamed up with market research firm Knowledge Systems & Research (KS&R) on a 759-worker survey on the subject of how post-layoff restructuring is going at many corporations, the results indicated that survivors may not be so happy.
Nearly half the laid-off workers surveyed, 46 percent, said their companies did a good job with staff reductions. By contrast, only 37 percent of the employees retained -- the "survivors" -- said they felt their companies had handled the cuts well.
According to 46 percent of respondents -- all of whom were drawn from Andersen's online-user panel of 5,000 members -- morale among workers has deteriorated in the past six months.
What's happened in the past six months? You need only look at the past 10 days for a quick overview. Among layoffs made, announced or anticipated -- Tellabs, 1,000 jobs; AOL (part of AOL Time Warner, parent company to the CNN News Group), 1,200; Steelcase, up to 1,100; J.P. Morgan Chase, up to 3,000 on top of 5,000; Ford, 4,000 to 5,000; Ames, 2,000; Corning, 900; Citigroup, 3,500; Tyco, 11,300.
At companies now contemplating or making cuts, restructuring may only be beginning. At others, it's been underway for months. And it's at those that Andersen's and KS&R's research shows nearly half of the surviving employees indicating a downturn in employee morale over the past six months. Five percent of respondents told researchers that morale is "much improved." Fourteen percent classified it as "somewhat improved." Thirty-five percent said there'd been no change. Thirty-one percent said morale has "somewhat decreased." and 15 percent termed morale at their companies "much decreased."
"One thing we suggest" to corporate managements, Detampel says, "is direct and open communication with the employees. Most survivors hear about coming layoffs through rumor and word-of-mouth."
In fact, according to the new study, 47 percent of survivors said they heard about coming layoffs by rumor and word-of-mouth.
Among those who were laid off -- who, perforce, must have specific communication about what's happening to their employment -- 73 percent said they were told via an "internal meeting and/or direct contact with management. Just 32 percent of survivors told researchers they'd been told about layoffs and/or restructuring in an internal meeting or through direct management contact.
Eleven percent of responding survivors and 13 percent of those laid off cited an "internal memo" as the means of layoff information. Five percent of survivors and seven percent of those laid off said they found out through media coverage.
"We recommend a communication strategy for survivors that's focused on their needs," Detampel says. "We suggest a company, as much as it does for people being laid off, make sure there's an appropriate outlet for survivors to express their concerns, a channel, almost for mourning."
When it comes to what concerns survivors may have, the Andersen and KS&R material found a cluster of top concerns that Detampel says all amount to little more than a fear of being laid off. Survivors have watched their colleagues leave in sometimes wide-ranging layoffs -- they may be left wondering if the same fate doesn't await them.
Of responding survivors in this study, 21 percent said their main concern was a change in corporate culture or work environment. That, says Detampel, translates to a fear your job will be changed to such a degree that you no longer fill the bill -- and are laid off.
Nineteen percent of survivors overall said their main concern is being laid off, themselves. In technology, media and other communications companies, as large a group as 30 percent of survivors said they fear being laid off, themselves.
Eighteen percent said they were worried about leadership changes. Sixteen percent said they were concerned about internal reorganization. Another 16 percent overall said they feared they might not receive raises -- this concern ran as high as 26 percent in health-care industry respondents. Twelve percent overall worried that their benefits could be cut -- that figure went up to 23 percent for survivors in manufacturing.
"In general," Detampel says, "layoffs are viewed both by the press and employees as very negative. Most companies just want to sweep what's happened under the rug and move on. But I think there's a value to giving people an opportunity to be heard, creating some communication with the survivors."
A part of the Andersen program for corporate clients going through restructuring, Detampel says, is a course called "Managing Survivors' Syndrome."
"It's a structured training course we run managers through to help them deal with employees in their groups who are survivors."
Some industry opinion suggests that layoffs and post-layoff restructuring should be handled by separate management teams, so survivors in a restructured company aren't left following the same leaders who have just implemented layoffs. Contrary to this view, Detampel says he doesn't necessarily see it as a mistake to have the same administration that's going to lead a restructuring effort start by implementing the layoffs.
"I don't think that's a mistake. At the end of the day, management is driving this. The one thing I've seen some companies do is try to hide that. I don't think you want to try to create some other executioner. I think there's something to be said for standing up and saying, 'These are management decisions. We made these decisions and this is why.'
"For most managers, this experience is very tough for them, too. If they can get up and people can see someone being a little more emotional about it -- not just an e-mail, an announcement, it can help."
We the living
In other data gathered in the study, 53 percent of survivor respondents indicated that their work responsibilities had increased in the past six months. In fact only five percent said their responsibilities had "somewhat decreased" or "greatly decreased." Forty percent cited no change in responsibilities.
In terms of perceived risks of layoffs in the next six months by sector, 48 percent of respondents said manufacturing jobs are at risk; 46 percent said technology jobs are at risk; 31 percent said retail jobs are at risk; 28 percent said telecommunications jobs are at risk; 26 percent said travel, leisure and hospitality industry jobs are at risk in the latter half of this year; 23 percent saw financial-services jobs at risk; 17 percent saw commercial services and wholesale and distribution at risk; 15 percent saw entertainment and media jobs at risk in the next six months; 13 percent cited jobs at energy concerns and utilities as being in jeopardy. Indeed, in the perception of study respondents, health care jobs were seen as the least at risk, with only 11 percent of those asked saying those jobs are at risk.
Detampel makes the point that the rapidly tightened job market can make survivors feel trapped in their jobs.
"One reality," he says, "is that it's taking people longer to find jobs" after being laid off, "a lot longer than we've seen in past years."
This perception was borne out in a recent techies.com study that found that 76 percent of tech professionals laid off within the previous six months hadn't found new work, and 65 percent of IT pros laid off for six months to a year still hadn't found new work.
"People are also much more open to changing industry, changing jobs and thinking about their careers in different ways. We're seeing unemployment rise," jobless claims edging up to 393,000 last week, from the previous week's 385,000, the new number a nine-year high.
"In the past year," FinancialOxygen economist Steven Wood told CNNfn, "the number of people receiving state benefits has increased by more than a million. Although the pace of layoffs has eased, job creation remains nonexistent."
And this factor, Detampel says, is contributing to the strain survivors are feeling.
"Some companies see this as a safety net. 'They're not going to leave' in such a tight job market, 'so why focus on the survivors?' When a management believes its survivors won't leave because the economy is tight, that can taint how that management treats those people."
One of Detampel's Andersen associates, Michael Lyman, U.S. managing partner for the company's "strategy, organization and people practice," says, "It is extremely dangerous to alienate the employees you want to retain as a result of poor communication. Companies are remiss if they don't keep the needs of employees at the forefront during such a disruptive cultural change" as major restructuring after layoffs and other cost-cutting measures.
"This survey," Lyman says, "is evidence that many companies have not done enough to minimize the emotional damage for employees who are retained during restructuring."
If there are bright spots in the Andersen and KS&R study, they may lie in the outlook of corporate survivors, 46 percent of whom told researchers they expect to see new hirings at their companies within the next six months. Only 16 percent of respondents said they foresee more layoffs. Fifty-one percent said they're confident in their job security -- and more than 77 percent of responding workers who have been laid off said they believe they can find new employment in a short time.
Detampel is more cautious about predictions of a speedy upturn. "I really don't see this changing over the next three to four quarters," he says.
"In the consulting industry, which is now being hit hard by layoffs, there are unprecedented numbers of consultants looking for jobs. One outplacement firm that specializes in placing consultants cites a volume increase from four consultants per month to 50. People in my industry see that and they realize that the competition is going to be pretty tough out there for whatever jobs exist."
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