Congress has Passed the Stimulus. 5 Ways to Now Avoid Layoffs

When the 2008 financial crisis hit its peak, Toyota was experiencing one of the worst markets in the history of the company and was expecting its first operating loss in 70 years. Our office in Singapore was the only regional headquarters in the world that was in the black. I was leading a team of ten people implementing customer experience projects across the region. As the situation worsened, VPs in leadership meetings repeatedly made clear that the future of Toyota as a company depended on its success in Asian markets. There was no small amount of pressure.

Layoffs in manufacturing were an inevitable part of the conversation and expected to occur. And then they didn’t. Toyota announced that instead of laying off assembly line workers, they would decrease vehicle production output, cut production hours, retrain employees to work on other lines, and use downtime to clean the plant but not cut pay. The result? Loyalty.

A McKinsey survey of 2,000 U.S. companies found that from 2008 to 2011 (during the recession and its aftermath), 65% resorted to layoffs.

In a 2012 review by the University of Texas at Arlington, they found that layoffs had a neutral to negative effect on stock prices in the days following their announcement. They also discovered that after layoffs a majority of companies…