Employee Performance Increasingly Cited As Reason For Layoffs in 2024

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A recent survey by LHH, a talent solutions provider under the Adecco Group, reveals that 73% of employers are planning or considering layoffs in 2024. The primary reasons cited include performance issues, skill mismatches, and financial pressures. The survey, which included over 3,000 HR leaders and 8,100 white-collar workers across nine countries, highlights a significant shift in the drivers for layoffs from over-hiring to poor performance (30.2%) and lack of appropriate skills (29.7%).

HR directors are investing in outplacement services to help employees move out of the company and are increasingly using redeployment tactics to fill skills gaps. With an emphasis on talent retention and reskilling, redeployment programs have gained popularity; 82% of HR directors are considering them as a layoff substitute. Since 2023, the share of HR leaders carrying out redeployment projects has increased by 25 points, to 47%.

Russell Williams, senior vice president of career transition and mobility at LHH in North America, stressed how technology affects the competencies required for successful organizational outcomes. "Our findings underscore that HR leaders are acutely aware of how technology is impacting the skills needed for organizational success," he said. "In the face of economic challenges, employers are increasingly reassessing whether their workforces are meeting these evolving needs, while also looking at how technology can be harnessed to support their employees’ growth both within the organization and as they depart."

Layoff support services are also becoming more popular, with 43% of HR leaders offering career coaching and 45% providing access to outplacement services. However, there is a significant gap in employee awareness, as only 10% of workers reported that their employers offer career coaching, and 9% are aware of outplacement services. This highlights the need for improved communication about available support services.

Additionally, significant worker burnout is a growing concern, with 69% of employees reporting burnout within their teams. Concerns about increased workloads leading to burnout have risen among HR leaders, with 25% expressing worry, up from 6% in 2023.

What do you think? Are these findings fair? Leave your comment below.

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