The impact of downsizing on the long-term employees' self-concept
Sears, Elizabeth Ann
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Downsizing has become one of the major means used by corporations to increase productivity and reduce debt. Uchitelle reports between 1984 and 2004, approximately 30 million Americans were involuntarily "laid off" or terminated. Millions more, fearing they would lose their jobs, either took early retirement or agreed to accept significant cuts in their wages or benefits (as cited in Marable, 2006). With an increase in the number of corporations utilizing downsizing, there is an urgent need to investigate the impact of downsizing on long-term employees of an organization. This case study examines employees' self-concepts and how workplace changes are communicated and (mis)understood among workers. Utilizing symbolic interactionism and identity theory, participant observation and focused interviews are used to characterize the implications of downsizing on the self-concept of employees experiencing this phenomenon. The participant-observer found evidence that not only downsizing, but moving from a participative management to a more authoritarian management created a disempowering culture and climate change, which has a negative consequence on employees' sense of self. This culture change shook employees' trust in the corporation, and how they interpreted top-down communication. Poor communication, in turn, by management also created an environment which negatively effected employees' productivity. The negative consequence of the downsizing continues to impact employees today, a year and a half after leaving the organization earlier than anticipated, suggesting long-term implications of down-sizing.