Investing in trust has never been more critical. Amidst a tumultuous economic landscape and evolving expectations of both employers and employees, 91% of executives say that their ability to earn and maintain trust improves the bottom line, according to PwC’s 2023 Trust Survey.

But the same conditions that make trust so valuable can also make the road to earning it feel unsteady. How can employers lead with empathy while also being responsive to the market? If layoffs have to happen, how can they cause the least damage to company culture?

According to PwC’s 2023 Global Hopes & Fears Survey, the percentage of employees who say they have money left over at the end of the month declined to 38% in 2023, down from 47% in 2022. In an environment like this, where employees increasingly feel the impact of a tumultuous market, compassionately connecting with them can be the key to building trust, enhancing culture and driving successful organizational transformations.

Workforce reductions hurt, but they don’t have to erode trust.

Market conditions have forced workforce reductions across industries in the last 12 months. And at the same time, the “great resignation” is not slowing down: 26% of employees worldwide say they plan to quit their job in the next 12 months, up from 19% last year.

Employers are challenged to create a transparent company culture that encourages retention and stops trust from eroding during difficult times. Although most employees (80%) recognize that layoffs can have a negative impact on their trust in an organization, they also identify specific actions that may help: encouraging managers to increase communications with remaining team members (58%), offering generous severance packages (57%), and being more transparent about the reasons for layoffs (57%).

However, executives aren’t nurturing these opportunities, only 38% say they’re encouraging managers to increase communications, 32% are offering generous severance packages and 35% are being more transparent about the reasons for layoffs.

The opportunity: Assess and balance the needs of multiple stakeholder groups in order to maintain trust. Organizations have an opportunity to be more transparent and proactive about how they support employees who are released from the company, as well as the remaining workforce impacted by those departures.

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