LHH GLOBAL DATA REVEALS LAYOFFS INCREASINGLY DRIVEN BY SKILLS GAPS, UNDERPERFORMANCE AS JOB MARKET COOLS

Survey of 3,000 HR leaders and 8,100 workers across nine countries uncovers the shift from over-hiring to targeted layoffs, with 73% of employers undertaking or considering layoffs in 2024.

NEW YORK, Aug. 13, 2024 /PRNewswire/ -- LHH, a leading integrated talent solutions provider and global business unit of the Adecco Group, today unveiled the findings of its 2024 Outplacement and Career Mobility Trends Report. The report, based on a survey of 3,011 HR leaders and 8,101 white-collar workers across nine countries, reveals that the nature of layoffs is significantly shifting in the face of technological advancement and persisting economic challenges. Fewer HR leaders are citing over-hiring as the primary reason behind layoffs, instead pointing to performance issues, a misalignment in employee skills, and financial pressures.

"Our findings underscore that HR leaders are acutely aware of how technology is impacting the skills needed for organizational success," said Russell Williams, Senior Vice President of Career Transition & Mobility, North America, at LHH. "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."

As layoffs continue, LHH found that HR leaders are turning more to redeployment strategies to address skills gaps and are investing in outplacement services to support outgoing workers, helping them transition to new opportunities.

"The global job market has undergone significant reshaping over the past year, largely due to the rising impact and integration of AI," said John Morgan, President of LHH's Career Transition & Mobility and Leadership Development businesses. "As the workforce adapts to this new reality, our research tells us that leaders are recognizing the need to evolve talent strategies to support employees throughout their careers, making reskilling and redeployment essential for maintaining an agile organization. Technology has significantly enhanced career phases like outplacement, enabling us to quickly identify and develop in-demand skills for transitioning workers. Once the awareness gap for this support is bridged, both employers and employees will be equipped to navigate the future with greater confidence and strength."

Key Findings:

Layoffs shift focus to skills and performance as cost-cutting persists
Layoffs remain widespread and are showing small signs of slowing: 73% of HR leaders are making or considering layoffs this year, down from 77% in 2023. The primary drivers for layoffs have significantly shifted from over-hiring to poor performance (30.2%) and lack of appropriate skill sets (29.7%). With AI becoming more integral to the workforce, there is a heightened need for employees to possess relevant skills. Additionally, amid inflation and economic turbulence, cost-cutting imperatives (28%) have continued to be a significant factor driving layoffs.

Redeployment programs gain traction
There has been a notable shift towards redeployment programs, with 82% of HR leaders considering redeploying workers as an alternative to layoffs. In similar fashion, the proportion of HR leaders with redeployment initiatives in place has increased by 25 percentage points since 2023, now at 47%, indicating a growing trend towards retaining and reskilling talent.

Organizations step up with layoff support – but workers are unaware
Employers are preparing workers to meet skills demands even as they depart, with 43% of HR leaders reporting they provide career coaching services and 45% indicating they provide access to outplacement services. However, a lack of awareness of this layoff support is evident among workers, with only 10% of workers saying their employer provides career coaching and 9% saying the organization offers outplacement services.

Burnout is a worldwide issue
As layoffs continue, worker burnout is a worldwide issue that HR leaders are recognizing. Globally, 69% of workers say their teams are burned out, with similar rates reported across different countries. Notably, burnout has become the top concern for HR leaders, with 25% worried about increased workloads leading to burnout, up from 6% in 2023. Employers should note the impact of burnout in the fallout of layoffs, as workers' top response is to reconsider their future with the company. While 28% of workers considered leaving their employer, a quarter applied for jobs outside the organization, and another quarter explored internal opportunities. This demonstrates a clear need to empower employees with opportunities for reskilling into internal roles and leadership development to facilitate a smooth transition and drive retention among the remaining workforce post-layoffs.

Visit the Outplacement & Career Mobility 2024 Trends Report for more insights.

About LHH
LHH is an integrated talent solutions provider helping people, teams, and organizations prepare for what's next in the future of work. Through Career Transition & Mobility, Leadership Development, and Recruitment Solutions, our end-to-end offerings allow us to work across the entire talent journey to help future-proof organizations and careers all over the world.

With over 8,000 colleagues and coaches spanning 60 countries worldwide, LHH combines global infrastructure with industry-leading technology and local expertise to help more than 15,000 organizations and nearly 500,000 candidates each year.

LHH is a global business unit of the Adecco Group, the world's leading talent advisory and solutions company, headquartered in Zurich, Switzerland.

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SOURCE LHH