Trust that management will lay people off only as a last resort pays off in remarkable ways.
It’s hard to give your all at work when you’re worried that you’re next on the chopping block.
Stress and fear around layoffs has had a negative effect on employee mental health, productivity, and engagement. And when workers give and do less, businesses suffer.
What breaks that cycle? Trust in your workplace.
Workers who trust that management will lay people off only as a last result are more likely to look forward to work, give extra on the job, and adapt quickly to business changes, according to Great Place To Work® research.
Those high agility and productivity levels are relished by leaders at any time, but particularly during periods of economic uncertainty.
Employee trust in management around layoff decisions is one of many reasons the Fortune Best Workplaces in Chicago™, Texas, New York, and the Bay Area outperformed typical U.S. workplaces across productivity, retention, and recruitment.
“This is why trust matters,” says Michael C. Bush, CEO of Great Place To Work. “This is how it shows up. It’s hard to stay motivated and be ‘all in’ when you wake up with fear and dread that you’ll be out of a job.”
But if employees believe layoffs are a last resort at their workplace, the quit rate is cut in half and motivation to come to work is 210% higher.
“These workers trust their leaders to make tough decisions, and that comes from a reservoir of trust built long before hard times hit,” Bush says.
What drives employee trust in management decisions around layoffs?
The top four drivers, according to Great Place To Work research, are confidence in the executive team, company pride, feeling welcomed, and a caring work environment.
Great Place To Work determined the Best Workplaces in Chicago, Texas, New York, and the Bay Area by analyzing data and survey responses from more than 420,000 employees.
Feeling welcomed helps companies during downturns
Out of all the measures of the employee experience among the winning companies, feeling welcomed topped the list, with varying impact across regions.
Employees who felt welcomed when joining companies in the Bay Area and Texas are 40% to 50% more likely to recommend their companies, and employees who felt welcomed when joining companies in Chicago and New York are 10% to 30% more likely to be agile.
Making employees feel at home is one of the five areas of the employee experience critical to surviving and thriving amid downturns, according to a 15-year recession study from Great Place To Work. How welcomed employees felt predicted company performance.
There are many ways to help employees feel welcome, whether they’re new to your company or new to a team. The first step is to recognize the impact of a new teammate through introductory meetings that will spotlight their talents.
It’s also important to actively seek their ideas and input in decision-making instead of making them “prove” themselves.
“These workers trust their leaders to make tough decisions, and that comes from a reservoir of trust built long before hard times hit.” - Michael C. Bush
Kimpton Hotels & Restaurants (No. 11 on the Best Workplaces in the Bay Area among large companies) asks new employees to fill out a personal preference profile to get to know them better right away.
The list of questions vary in complexity and depth, and includes questions such as: What do you like to do for fun when not at work? What’s your favorite food or snack? Tell us one thing that people would be most surprised to know about you.
When Lindsey Yealy, catering sales manager at the Hotel Monaco in Pittsburgh, started at Kimpton, she was blown away by the individualized welcome her managers gave her based on what they read. Here's how she felt about receiving a “Welcome to the Family” postcard before starting:
“It was a small act of kindness that went such a long way for me. I had shared that I had Type-1 diabetes and mentioned bringing in some juice boxes to put in the communal fridge for my low blood sugar. Within the hour, I had my own personal mini fridge set up in my cubicle. Living and working with Type-1 diabetes is so stressful and challenging most of the time.”
Knowing her team here was there to “help in any way makes a world of difference,” she says.
Company pride fuels recruitment
Another metric leaders chase is recruitment. The ability to fill the pipeline with much-desired referrals is the result of giving people a workplace experience they’re proud of.
What drives those referrals? Pride. It’s the No. 1 recruitment driver across all regions.
Employees who feel high levels of company pride are 4.3 to 6 times more likely to recommend their company to others.
Pride also drives retention and is second only to meaningful work. Employees who feel pride are between 1.8 and 2.3 times more likely to stay, and those who feel their work is meaningful are 2.8 to 3 times more likely to stay at the company.
More than nine out of 10 employees across these four regions said they’re proud of their company’s reputation compared with six in 10 employees at a typical workplace.
Giving back to the community helps instill pride at NuStar Energy, No. 9 on the Best Workplaces in Texas list of large companies.
The company’s chairman, CEO, and executives work side-by-side with employees on volunteer projects that are organized by employee-run Volunteer Councils.
Weekly volunteer projects range from cleaning up parks and mentoring students to delivering meals to seniors and coordinating parties for children with disabilities.
NuStar also matches employees who want to serve on a nonprofit board with an organization that matches their interests, and supports them by providing contributions and other resources to the charity.
Building workplace pride is a competitive advantage, and is the result of consistent effort. Creating one of the best workplaces in the country can’t happen without prioritizing this often overlooked way to engage employees.
Regional workplaces improved in different ways
Here’s a look at how companies in each region created a great workplace for their people — and set them apart from the average.
- 2023 Best Workplaces in New York Offer Career Growth, Flexible Schedules
- Pride, Flexibility Stand Out for 2023 Best Workplaces in Bay Area
- 2023 Best Workplaces in Chicago Make Fairness Top Priority
- 2023 Best Workplaces in Texas Offer Inclusion, Balance
How to make the list
Think your company deserves special recognition? Get started here to become eligible for next year’s Best Workplaces™ honors.