Workforce Reductions Got You Down? Here’s How Tech Companies Can Stay Productive

Last year was a big one for tech layoffs, and this year is already looking like more of the same. In March alone, we’ve seen layoffs from big names like Meta, Microsoft, Salesforce, Atlassian, and Waymo—not to mention layoffs from smaller companies and startups around the world.

While going through a workforce reduction is never easy, there are steps you can take to ensure your remaining employees stay motivated, focused, and working towards your company’s goals. In this article, we’ll explore some of the strategies you can use to keep your team productive during these challenging times.

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Communicate openly and transparently

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The first step to maintaining productivity after a workforce reduction is to communicate openly and transparently with your team. It’s important to let your employees know why the reduction was necessary and how it will affect the company moving forward. Be clear about what changes are being made and why, and provide as much information as possible to help your team understand the situation.

One study titled “Workplace financial transparency and Job distress” published in the peer-reviewed journal Social Science Research found that employees at companies practicing “very good financial transparency” saw a 17 percent decrease in workplace-related stress.

Notably, the correlation between company financial transparency and decreased employee stress levels held consistent across a wide variety of employees (the study analyzed data from 2,680 British workplaces and 21,981 employees), regardless of union status, income level, decision making involvement, and tenure.

Transparency is more than just sharing information

But transparency goes beyond just sharing updates on the company’s financial status. According to a paper titled “Organizational Transparency: A New Perspective on Managing Trust in Organization-Stakeholder Relationships” published in the peer-reviewed Journal of Management (JOM), transparency consists of three components:

1. Information disclosure
2. Clarity
3. Accuracy

Sharing information is a good starting point, but it’s crucial that employees can understand the information you’re sharing and that the information is accurate.

As the authors of this paper point out, leadership should consider their audience when communicating information like company financials, going out of their way to clarify processes and jargon that might not be common knowledge outside of the C-suite. For example, sharing a slide on EBITDA during a stakeholder meeting might be confusing without some explanation of what that acronym means and why it’s significant.

It may seem like a no-brainer, but the information you share with stakeholders also needs to be accurate. This can be easier said than done in a large organization with complex operations, especially when there are compliance or legal concerns around sharing certain information. Even if done accidentally, sharing inaccurate information can harm employee trust, with the potential to lower productivity as well.

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Use staff augmentation to provide extra lift

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After a workforce reduction, remaining employees usually have to take on more work to compensate for lost resources. To ensure that they can handle the increased workload, it’s important to provide them with the support and resources they need to succeed.

One way to do this is by investing in new tools or technologies to improve efficiency. Instruct department and team leaders to conduct business process audits to identify inefficient processes and then work on streamlining them. Implementing business process management across your organization and looking into adopting business process management (BPM) software can help you do the same amount of work or more with a lower headcount.

Bringing on additional temporary staff or contractors is also a good idea to provide extra support to remaining team members while you wrap up projects or optimize processes. This is called resource and staff augmentation, and it can be a cost-effective way to fill specialized skills gaps without hiring new W-4 employees.

“Leveraging alternative staff augmentation solutions such as freelancers, contractors or nearshore resources is critical to maintaining production and meeting deadlines when going through a workforce reduction,” says NerdRabbit Cloud Recruitment Manager José Buenrostro. “We’ve especially seen nearshore become a popular solution for our clients recently. Labor costs for nearshore talent can be up to 50 percent less than comparable US- or Canada-based talent, and—depending on where you’re located—you could see better time-zone overlap [with nearshore] versus hiring onshore contractors.”

In addition to workforce reduction support, resource and staff augmentation is a good strategy for staying nimble in a variety of circumstances. Some examples include:

• Supplementing your team’s skill sets with specialized resources
• Providing extra lift on a large project
• Temporarily staffing a critical role while you work on recruiting someone full time

Even if it’s just to provide extra support while the dust settles, bringing on contractors for extra help a few hours a week can mitigate a dip in morale after a workforce reduction. The more you can lighten the load for remaining employees taking on more work, the better.

Avoid empty shows of appreciation and offer real support

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If there’s one field where workers have felt the stresses of workforce reduction, it’s nursing. The reasons for the shortage of nurses in the US and UK are many, including factors like aging patient populations, inadequate pay, and high turnover rates.

Nurse staffing levels were bad before 2020, and the pandemic made them much worse. Staffing levels have become so bad, in fact, that in 2021 the American Nurses Association wrote to the US Department of Health and Human Services urging them to declare a national crisis over the shortage of nursing staff.

Every year, Nurse.org conducts a State of Nursing survey to report on trends and challenges facing the field. Of the over 1,500 nurses they surveyed for the 2022 report, 80 percent said their units are inadequately staffed, and 87 percent said they had felt burnt out in the past year. The report is full of other bleak statistics, though not without explanations or proposed solutions.

“The truth is that despite the 7 pm cheers, the commercials thanking nurses for their dedication and selflessness, and the free food from major retailers—the overwhelming majority of nurses are burnt out, underpaid, overworked, and underappreciated,” writes Kathleen Gaines, MSN, RN, BA, CBC in the report.

An article published in Dome, a publication from Johns Hopkins Medicine, echoes this sentiment. Titled “One Year Later: Are Front-Line Workers Still ‘Heroes’?” the article quotes a nurse at The Johns Hopkins Hospital named Mansi Patel, who said, “Although so much appreciation felt good at first…the feeling was short-lived as infection rates climbed and safety precautions were, at times, ignored.”

According to the previously mentioned survey from Nurses.org, what nurses really need is:

• Better pay
• Safer staffing levels to lower the nurse-to-patient ratio
• Improved mental health resources
• Hazard pay

The survey report points out that many nurses don’t want to leave nursing as a profession, but without proper support, they’re left with few other options.

Takeaways from the nurse staffing shortage

Working in tech, employees aren’t putting their lives on the line like so many of the brave, caring nurses and other healthcare providers did during the pandemic. But just as calling nurses “heroes” can be a harmful narrative and shows of gratitude can start to ring hollow, employees also need real support from leadership.

> Flex Work: Making Work Work for Everyone

Before ordering pizza for the office, sending thank-you notes, or passing out company swag in an attempt to boost morale—however well-intentioned—consider implementing some of the following techniques instead:

• Giving everyone the day off from time to time
• Providing real mental health resources (not just a subscription for a meditation app)
• Sending pay bonuses or introducing profit-sharing
• Supplementing understaffed teams with contractors
• Giving employees additional PTO
• Providing employees with real career development opportunities like additional trainings, conference attendance, and special projects

These are just some ideas to get you started. The best way to support your employees well is to start a discussion to learn what they need from leadership. It should go without saying that creating the kind of work environment where employees feel comfortable speaking candidly is a prerequisite to a productive conversation of this sort.

Workforce reductions present challenges, but they can be overcome

While a workforce reduction is never an easy situation to be in, there are steps you can take to keep your tech company productive:

• Transparency and open communication are key to maintaining trust and reducing stress levels, and it’s important for leadership to consider their audience when communicating information
• Staff augmentation can help provide extra support to remaining team members struggling with increased workloads and skills gaps
• Companies should also avoid empty shows of appreciation and offer real support to their employees

These strategies can help keep morale up and ensure that your remaining employees stay motivated and up for the challenge at hand.

Generative AI contributed to the writing of this article

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