[The Editors' Verdict] The Era of Ruthless Layoffs

Kyung-ho Lee, Head of Issue & Trend Team

Jordana Hernandez, who worked at the American electric vehicle company Tesla, experienced a chaotic Monday at work. Employees who missed the termination emails sent on Sunday showed up on Monday, only to find their employee badges deactivated, causing widespread delays in attendance. Hernandez wrote on LinkedIn (a business-focused social community), "I gave my blood, sweat, and tears, but the company showed no humanity at all." She added, "To all the leaders still here, please continue to be the compassionate leaders your teams need" and urged them to "keep showing people that Tesla is more than just regressive policies and metrics." After Elon Musk’s acquisition, Twitter (now X) employees were locked out of Slack (a collaboration tool) and received termination notices via emails titled ‘Your role at Twitter.’

According to the corporate layoff tracking site Layoffs.fyi, 74,672 people were laid off from 259 tech companies as of the 20th this year. Over the past three and a half years, 500,000 people lost their jobs across 1,064 companies in 2022 (165,269 people) and 1,192 companies in 2023 (263,180 people). In short, the approach is ‘picky when hiring, caring while employed, and ruthless when firing.’ In the U.S., layoffs are easier than in any other country, and reemployment opportunities and hiring for experienced positions are active. Because perceptions of layoffs differ, people post videos of their own layoffs on social media to seek comfort. Responses to layoffs range from ‘quiet quitting,’ where employees do the minimum since they expect to be fired anyway, to ‘loud quitting,’ where they openly express their resignation and say everything they want before leaving.

In South Korea, layoffs are not easy except for urgent business reasons. Companies use voluntary retirement and early retirement programs to let people go. Only a small number leave with severance and consolation payments amounting to hundreds of millions of won. For Korean workers, the saying "Inside the company is a battlefield, but outside is hell" is a golden rule. No company tolerates employees just enduring; many use subtle methods to make employees leave voluntarily.

Europe is similar. If employees do not accept reasonable offers to retire, companies exploit every loophole to fire them. They make working conditions miserable. For long-term employees, since severance and other costs are high, companies use even more subtle methods to induce ‘voluntary resignation.’

In the post-pandemic and AI era, and with industrial changes like electric vehicles, brutal layoffs will continue. In the AI era, AI will create or eliminate jobs and handle everything from hiring to performance evaluation and layoff notifications. Extreme proponents say that layoffs are not a sign of a company sinking but a sign of it thriving. Shareholders are kings, and workers are necessary burdens that become less needed over time.

The 2009 movie In the Air features a layoff expert who travels across the U.S. to notify employees of their termination. Times have changed, and companies now replace layoff notifications with video interviews. Among the many people laid off this way, a female employee committed suicide. The company eventually stopped video layoffs, saying "not now," and rehired the layoff expert.

Firing people is inherently cruel. It is especially so when employees leave with uncertain futures and livelihoods. Both those who remain and those who leave inevitably suffer trauma for some time. Is it naive to expect a humane way to ‘send off’ employees rather than just ‘cutting’ or ‘letting them go,’ and to hope for humanity in this process?