Current economic crisis: you want to retrench, now what?


Lyndy van den Barselaar | Managing Director | ManpowerGroup South Africa | mail me |

As a result of the current economic crisis that the world faces, organisational change is an unfortunate reality for many businesses. This can lead to changes in the market as businesses adopt Working From Home (WFH), shifts in business strategies, the need to optimise processes, has already led to job losses and retrenchments.

If more employers and businesses adopted international best-practice retrenchment programmes that look to empower those being retrenched – both emotionally and practically – then those remaining within the company would similarly recover faster, thereby mitigating the negative impact of the retrenchment process.

Stress and anxiety

It is important to remember that it is not only the retrenched employee that faces high degrees of stress and anxiety during the outplacement process, but the employer as well – be they the line manager, the human resources department, or the business owner.

All involved parties go through a significant amount of psychological stress before, during, and long after the process has finished.

Businesses can partner with a workforce solutions provider that enables businesses to empower those being retrenched as quickly as possible, through either training and up-skilling for new employment prospects, or assisting those who wish to enter the entrepreneurial marketplace with the essential skills, knowledge, and services to set up and manage their own business.

It is important to understand the association between the affected people and the line manager’s state of mind as the retrenchment process is embarked upon.

It is also critical to understand that when an employee is informed about, and starts the retrenchment process, both parties experience various stages of grief and trauma.

Regardless of the reason for the retrenchment, a large amount of the psychological stress can easily be lessened through programmes that aim to empower the retrenched employee/s.

Minimising the psychological impact of retrenchments

A beneficial side effect of such programmes is that those that performed the retrenchment, get over the negative psychological impact far quicker, and the impact itself is not nearly as large as the impact of a non-empowering retrenchment process.

If the impact of retrenchment can be minimised, then all parties can move on with their lives quicker, leading to a better working environment, more stable degrees of productivity, maintenance of employer brand, and lower rates of post-retrenchment resignations.

Globally, businesses that have implemented responsible retrenchment programmes report a significantly lower impact on their operations, as well as better relations with those employees that remain.

By investing in a programme that plans for assisting each individual being retrenched to move on and find new opportunities, almost all of the negativity of retrenchment can be eliminated.



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