Employees are the biggest asset for any organization. Thus laying them off is difficult for any company. It is almost as painful as parting with your children. However, there are times when companies don’t have any option, and are forced to downsize their staff.

Reason for layoffs:
Layoffs could be temporary or permanent termination of employees. The decision to layoff is mainly a decision taken by the company keeping in mind the business scenario. There are many reasons that could force he companies to layoff their employees such as:

Industry or global Slowdown
The industry for which the company is operating is witnessing a slowdown, will make the company realize that they need to streamline their processes and eliminate all the non core areas in order to survive.  The company would not be left with no option but to lay off their employees. Even if there is a global slowdown, companies go for downsizing, in order to sustain themselves in the market.

Cut cost
All the companies across the globe in the pursuit of increasing their margins are always on the look out for some or the other methods to cut costs. In the absence of any other way to cut costs, layoffs seems the best possible option for the company to reduce their operating cost and give a push to their bottom-line.

Spin-off
Many a times, companies might spin off all their non core areas in order to concentrate on their core business activities or for business reasons. This would again result in to termination of employees who are part of the non core areas.

Handle the layoffs sensitively
Downsizing, though difficult, shall be handled in a delicate and sensitive manner by the companies. Any company, who handles the layoffs insensitively, might face the brunt of other employees and also seriously jeopardize their market reputation. Once the company intends to downsize, the first step that the company should take is to inform their employees about their decision in an appropriate manner. Employees should be the first ones to know about the layoff, as any information they receive from outside sources regarding the layoffs will be pushing the envelope too far.

Once the company is through with conveying the layoff decision to employees, they should communicate with he employees the reasons for which company is taking such a drastic step. Company should be able to convince the employees that whatever they are doing is in the best interest for everyone and downsizing was their last resort. Also, the management should not feel guilty about the layoffs as it was nothing personal, but a business decision taken by the firm.