The times they are a‐changing: who will stay and who will go in a downsizing organization?

Abstract

Human resource management has entertained the rise of downsizing as a strategy for producing visible improvements to organizations. However, the history of downsizing has failed to consistently provide the anticipated benefits. This study postulates that success is contingent upon the severance acceptors possessing characteristics least beneficial to the organization. The study explored 234 employees from a major Australian transport company, 141 who remained after the downsizing, and 93 who accepted severance packages. It was found that those employees who left showed significantly lower levels of affective and continuance commitment and job satisfaction, significantly higher levels of intention to turnover and absenteeism, and no significant difference for perceived organizational support. Furthermore, employee intention to turnover was significantly predicted by employees commitment and job satisfaction. This study concludes that downsizing should not be governed by retrenching employees in abundance, but should be guided by retaining those most valuable to the organization.

Citation

Cross, B. and Travaglione, A. (2004), "The times they are a‐changing: who will stay and who will go in a downsizing organization?", Personnel Review, Vol. 33 No. 3, pp. 275-290. https://doi.org/10.1108/00483480410528823