- A PwC survey identified steps employers can take to help restore trust amid layoffs.
- Workers say more communication and generous severance packages are important.
- Most execs overestimate how much trust consumers and workers place in their companies.
Laying people off is a pretty quick — and obvious — way to blow up any loyalty workers might have felt for a company.
Even for those who hang onto their jobs, layoffs can damage morale, innovation, and productivity. Those setbacks can eventually puncture corporate profits.
What’s not so apparent is that there are steps leaders can take to lessen the blow of layoffs. Making the right moves might even restore some of the trust that gets steamrolled when employers start letting go of workers, according to the results of a new survey from PricewaterhouseCoopers.
In an email survey of about 2,000 US workers, nearly six in 10 employees said companies could boost trust amid layoffs by encouraging bosses to step up communication with workers whose jobs are spared, by offering robust severance packages, and by being more open about the reasons behind the cuts.
“Trust is built in hard times, not easy times,” Wes Bricker, a vice chair and US trust solutions coleader at PwC, told Insider.
It’s been a tough few months for trust in the workplace. Bank runs and waves of job cuts across industries, including tech, have left some leaders and rank-and-file workers feeling uneasy.
Part of the challenge in building trust is the disconnect between how execs and customers see an organization. Eighty-four percent of the 500 business executives who took part in the February survey reported that consumers trust their companies to a high degree. But just over a quarter of the approximately 2,500 consumers polled reported having this level of trust in businesses.
There was a smaller gap between the people running companies and their workers, with 79% of business executives saying employee trust is high and 65% of employees agreeing with that.
The fallout from lack of trust goes beyond tarnishing a company’s reputation — something those atop corporate org charts acknowledged in the survey: Nine in 10 executives told PwC that the ability to establish and maintain trust helps their company’s bottom line.
Yet the gaps in trust revealed by the survey indicate that there’s more work for business leaders to do.
“Trust is not a fuzzy concept,” Bricker said. “Trust is a question of integrity and transparency and being a truth teller, not avoiding hard issues.”
The heightened uncertainty this year about the path the economy will take means there are plenty of difficult topics for leaders, and their workers, to cover. There are fights underway over everything from pay to remote work. And the job market remains strong overall despite a campaign by the Federal Reserve to raise interest rates and cool the economy in hopes of stomping out high inflation.
The recent challenges in some industries mean business leaders need to be straight with their employees, Bricker said, even when it’s difficult. Leaders can share what they’re thinking when it comes to pay and pay equity, hiring freezes, layoffs, and the health of the business and how that relates to decisions coming from the C-suite, he said.
“That’s real transparency,” Bricker said. “And even though it’s hard, in the long term it builds trust.”