Massive job cuts can reduce employee motivation

Date: 09/08/2010

Firms which make drastic job cuts could injure staff morale in the long-term, it has been claimed.

According to US employment expert Wayne Cascio, employee motivation is generally significantly reduced at firms which make substantial job cuts to stave off the impact of economic slowdown.

Speaking to NPR, Cascio, a management professor at the University of Colorado in Denver, said that a lack of leadership and motivation following job losses can also impact on a company's bottom line and its future liability.

"What we find with extreme downsizes is that in the long term, they really do suffer relative to competitors in the same industry facing the same sets of economic conditions," he said.

Commenting on the impact staff cuts can have on motivation, Cascio told the news provider: "Your mind's not going to be totally committed to focusing on what you're doing, when in the back of your head you're thinking, 'Man, am I getting laid off? I wish they'd tell us something. All we hear is rumours'."

Cascio's comments come after the Chartered Management Institute claimed non-fiscal rewards can help boost morale.

Posted by Michelle Fry

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