Are Redundancy Headlines Impacting Employee Confidence?

Are redundancy headlines impacting employee confidence?

In the immediate aftermath of the COVID pandemic, redundancy rates in the UK dropped to the lowest levels since records began. 

At the same time UK vacancy levels soared – peaking at 1.3 million open job opportunities in April 2022. Skills shortages drove rapid pay increases for many – changing employer could easily net you a pay rise of 10, 15 or even more per cent.

That combination of low risk of redundancy and high opportunity to secure a new job fuelled an era of high employee confidence in job security.

 

Fast Forward to 2025

 

In recent months we’ve been seeing more and more press headlines about looming redundancies (see our blog, “How the 2025 Jobs Market Makes Outplacement Support Essential“). At the same time vacancies have dropped by about 40% since that 2022 peak. Some commentators going as far as predicting a recession is looming.

So how is this gloomier outlook for jobs impacting employee confidence? 

And how in turn does that level of confidence impact employee behaviour?

 

The Link Between Job Security and Employee Confidence

 

Thirty years of career coaching experience tells us there is no one pattern of behaviour. 

People react differently depending on a range of factors. From personal circumstances to level of commitment to the purpose of their employer, it all depends.

What we can say is that the majority of individuals tend to fall into one of these categories:-

 

“Just in Case”

 

Individuals take no immediate steps to seek an alternative job BUT start preparing just in case. The CV is dusted off and updated. LinkedIn profiles are refreshed and more visits are made to job sites just to see what’s out there. In many cases individuals become passive job seekers – more open to approaches from outside the organisation. 

For HR the danger here is that an increasing number of people – often including your brightest and best – slip from fully engaged to casual job seekers and ultimately active applicants. The impact often isn’t seen immediately, it is more a slow erosion over time.

 

“Hunkering Down”

 

For these individuals the focus is all about protecting the job you have rather than jumping ship. Often driven by a sense that changing jobs now would be akin to “out of the frying pan and into the fire”. That might mean a short to medium term boost in discretionary effort and/or performance. However, the stress of feeling like you are fighting to save your job every day can be debilitating over time.

Again, the impact often isn’t immediate. Indeed, there may be a veneer of positivity. The challenge for HR is recognising what is bubbling beneath the surface. Now might be a great time, for example, to remind people what help is available via your EAP provider.

 

“Stress and Worry”

 

Uncertainty over job security can lead to stress which in turn leads to changes to behaviour. Mental health issues can emerge especially where individuals feel powerless to influence their own fate. Productivity can be heavily impacted as people expend more energy on worrying about the future at the expense of performing in the here and now 

HR should anticipate an increase in caseload as people struggle with the uncertainty.

 

“Jump Ship”

 

Rather than hunker down, people take immediate active steps to take control of the situation. Moving jobs becomes a major driving force and engagement with their existing employer rapidly deteriorates as energy is diverted to job seeking.

The challenge is that once people start leaving – and attribute that to uncertainty – it impacts everyone else. Timing and communications play a big part in containing the impact.

 

“Head in the Sand”

 

Often driven by a false sense of invulnerability – i.e. “this will never happen to me”. When the bad news eventually does come this group are often the hardest hit emotionally. They just didn’t see it coming.

 

How Can You Navigate This Challenge and Protect Your People?

 

Understanding the different ways employees react to job insecurity is crucial for HR Leaders who need to engage and support their workforce during times of uncertainty. 

How do you ensure that your organisation is prepared for potential redundancies and that you are doing everything possible to engage and protect your people? 

That’s where we can help. 

We’re hosting a free webinar, “Redundancy at Scale: How to Support, Engage, and Protect Your People” on Tuesday, the 15th of April from 2:00PM-2:30PM GMT.

Dive into best practices for managing redundancy at scale, keeping morale high, and ensuring your workforce is supported. During this session, we will cover: 

✅ How to effectively plan and prepare for the road ahead, including training those involved, getting timings right and clear internal communication.

✅ Practical ways to support employees through the transition – from wellbeing and emotional support to practical job searching and career change guidance.

✅ How to handle stress while ensuring employees moving on are supported and morale for those who remain is high.

✅ A live Q&A session.

Register now to secure your place and ensure you’re ready to support, engage and protect your people when managing redundancy at scale. 

We’ll see you there!