This report was written by Jill Mizell, Director of Survey Research.
Against the backdrop of ongoing economic uncertainty, the American tech sector – long a bastion of growth, innovation, and prosperity – has been rolling out waves of layoffs over the past year, with companies including Microsoft, Amazon, Meta, Salesforce, and more letting go an estimated 168,000 tech workers in 2023 alone, already surpassing the total number of tech jobs cut in 2022 (161,000). And while the labor market is still holding strong, with 10.8 million jobs open in the U.S. today, tech layoffs could signal further economic complications, including job cuts across other industries, and even be a harbinger of recession.
With companies increasingly turning to layoffs as a cost-cutting measure, it’s expected that tens of thousands more workers will be impacted. Layoffs are, it seems, an inevitability for many of America’s knowledge workers, and the question on the minds of corporate leaders and workers alike is: can layoffs be “just?”
As part of JUST’s ongoing work to understand how the public defines just business behavior, we turned to Americans to get their take on what it means to conduct ethical and just layoffs – and whether that is even possible. As we forge ahead in an increasingly unpredictable job market, the public’s views can offer critical insight for business leaders looking to consider the full impact of forthcoming and potential layoffs.
Key findings from JUST Capital’s survey include:
With ongoing mass tech layoffs continuing to make headlines, it’s no surprise that Americans are in the know. When we asked respondents whether they were familiar with this issue, a large majority (85%) shared that they have heard about recent mass job cuts in the tech industry, and one-third (33%) told us they’ve heard a lot about the job cuts.
Beyond just being familiar with the latest news, large percentages of Americans also believe layoffs could have been avoided – in particular, strong majorities of younger respondents and those who have heard about the most recent waves of layoffs, as well as Democrats and Independents.
Overall, half of Americans (48%) believe these mass job cuts in tech could have been avoided with proper planning, while 28% believe they were unavoidable due to economic uncertainty and 24% aren’t sure whether the job cuts were avoidable or not.
Among those that told us they’ve heard a lot about recent tech layoffs, respondents are more likely than others to say these job cuts could have been avoided (55%, compared to 45% of people who have heard a little about tech layoffs and 43% of people who have not heard about the tech layoffs).
Younger cohorts are significantly more likely to believe layoffs could have been avoided. 69% of Gen Z respondents (people aged 18-26) believe these tech layoffs were avoidable with proper planning, compared to 52% of Millennials, 46% of Gen X, and 40% of Boomers. Nearly a third of Boomers (31%) and Gen X (31%) say the mass layoffs in tech were unavoidable, making them twice as likely as Gen Z to say so (just 15% of Gen Z respondents believe the layoffs were unavoidable).
We also see a stark contrast when we look at responses by political party. While 50% of Democrats and 55% Independents believe recent mass layoffs in tech could have been avoided, just 36% of Republicans see them as avoidable.
With mass layoffs ongoing, the question of ethics is an inevitable one, and we turned to the public to ask them whether they believe mass layoffs can be ethical. A plurality of 43% believes that the ethics of mass job cuts depends on the situation, while 28% believe mass layoffs are unethical corporate behavior. Just 3% of Americans believe job cuts are ethical corporate behavior, and 13% believe layoffs are not an ethical issue.
Whether a respondent believes these layoffs could have been avoided or not plays a significant role in their perception of corporate ethics around layoffs. People who believe these layoffs were avoidable are more than three times as likely to say mass layoffs are unethical corporate behavior than those who believe the layoffs were unavoidable (44% vs. 12%).
On the flip side, people who felt the layoffs were unavoidable are twice as likely to say that mass job cuts are not an ethical issue at all compared to those who believe the layoffs could have been avoided (20% vs. 9%). People who think the layoffs were unavoidable are also more likely to say that the ethics of layoffs depend on the situation compared to those who believe the layoffs could have been avoided (53% vs. 35%).
Regardless of the public’s perspectives on avoidability and ethics, layoffs show no immediate sign of stopping. We asked respondents what companies should consider in order to conduct layoffs in as just and ethical a way as possible. Americans agreed that, for corporations to conduct layoffs in an ethical way, they must give workers advance notice in a respectful manner (69%); provide generous severance packages to workers including pay and health care coverage (61%); provide access to job finding services at no cost (52%); and reduce the number of jobs to cut by decreasing other costs as much as possible (52%).
When it comes to severance packages specifically, there is significant divergence between respondents with differing political views. 46% of Republicans believe companies conducting mass layoffs should provide generous severance packages, compared to 75% of Democrats and 63% of Independents.
When we asked the public what they think the short- and long-term impacts of mass layoffs might be, strong majorities shared that they believe mass layoffs have a negative impact on workers’ sense of job security (85%) and the overall economy (71%).
A plurality of 41% believes that mass layoffs will have a positive effect on short-term profits, while 27% believe layoffs will have a negative impact and 19% believe layoffs do not impact short-term profits either way.
When it comes to long-term profits, a plurality of 35% believe layoffs will have a negative impact on long-term profits, while 26% believe layoffs will have a positive impact and 22% believe layoffs do not impact long-term profits either way.
As Americans weather the ongoing storm of economic uncertainty, it’s likely that layoffs will continue to unfold in the tech sector and spread to other industries, as we are already seeing in media and manufacturing – and this week, with McDonald’s closing its headquarters in anticipation of job cut announcements. Corporate leaders will continue to face difficult decisions on how to cut costs – and while mass tech layoffs may or may not have been avoidable, they are happening now, and Americans are watching closely to learn whether companies are conducting these layoffs in a way that is ethical and just, and that minimizes negative impacts. It’s not yet clear how widespread these layoffs could become, or to what extent they will impact that broader job market, but as corporate leaders prepare for what to come, the voice of the public provides crucial guidance on how to navigate this challenging time in as just and ethical a way as possible.
This survey was conducted online and by phone in both English and Spanish within the United States by SSRS on behalf of JUST Capital. The survey fielded from March 3 to March 7, 2023. SSRS interviewed a representative sample of 1,027 U.S. adults (age 18 or older) for this survey from among its multi-mode Opinion Panel, a nationally representative, geographically diverse and probability-based panel reaching respondents in all 50 states.
The margin of error is +/- 3.6% at a 95% confidence level. Results were weighted to U.S. Census parameters for age, gender, education, race/Hispanic ethnicity, Census Division and specifically surrounding party identification in order to ensure representativeness of the U.S. population. All margins of error include “design effects” to adjust for the effects of weighting. Explore the topline results, question wording, and demographic breakdowns by question here. For complete survey methodology, including weighting variables and subgroup sample sizes, please contact firstname.lastname@example.org.
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