Recessions and redundancies – Are we there yet?

Philippa Flowerday, Career Transition Partner

A recent Forbes article echoes sentiment we are starting to hear, that we are heading for another global recession (for the full article click here) and that as with the GFC, mass redundancies are probable. In any redundancy situation we must proceed with caution, be planful and treat those affected with respect and dignity. 

Redundancy is a commonplace thing today and it is not unusual for companies to retrench and recruit at the same time. However in a recession, the odds stack against us even more with hiring freezes, mass redundancies and an upsurge in unemployment. At a time when we are still trying to understand what ‘digital disruption’ and AI means for the future of work, it would be a very stoic person that would not be concerned about their job security. 

The Forbes article raises some very good points about how to treat people affected by redundancy fairly but only briefly talks about the impact of redundancy on others…the ‘survivor’s, who remain in the organisation. While individuals may not lose their jobs, the possibility of ‘being next’ hangs over them, teams are often disrupted, reporting lines change and productivity slumps. 

In our experience organisations often act as if change stops when the retrenched leave, but to manage change well the focus must be on all employees.  Studies show that the total cost of redundancies can amount to  6x the direct cost from rises in absenteeism, unwanted turnover and productivity dips ranging from a conservative 20% up to 50%. 

If you would like more information on how to effectively manage separation processes and support all of your employees through impending change please contact me at