The tide is turning.

For several years, workers have enjoyed a seller’s market. Unemployment has been low, and companies have competed for the best employees. Now, for a variety of reasons, we are experiencing a surge in layoffs, exacerbated by sizable staff reductions in U.S. federal agencies. With so many newly-unemployed workers on the street, employers now have the advantage as we shift to a buyer’s market.

Emboldened by the flood of potential recruits on the market, and anxious to be on the good side of the current U.S. presidential administration, some CEOs are trading in their supportive servant-style leadership for old-school tough boss talk. And while they may be able to justify this behavior in the short term, the impact on the culture — and what that will do to the employer brand — could deter the best potential recruits from taking that job, which will be filled by a mediocre performer desperate for employment.

In this short midweek episode, Neville and Shel explore the reasons behind the layoffs, the impact of CEO tough talk, and how communicators can help maintain a strong, non-toxic workplace.

Links from this episode:

The next monthly, long-form episode of FIR will drop on Monday, February 24.

We host a Communicators Zoom Chat most Thursdays at 1 p.m. ET. To obtain the credentials needed to participate, contact Shel or Neville directly, request them in our Facebook group, or email [email protected].

Special thanks to Jay Moonah for the opening and closing music.

You can find the stories from which Shel’s FIR content is selected at Shel’s Link Blog. Shel has started a metaverse-focused Flipboard magazine. You can catch up with both co-hosts on Neville’s blog and Shel’s blog.

Disclaimer: The opinions expressed in this podcast are Shel’s and Neville’s and do not reflect the views of their employers and/or clients.

Raw Transcript:

Raw Transcript

evillehobson (00:02)

Shel Holtz (00:08)

As we know, business goes through phases. Right now, we’re entering into a reality that’s reshaping organizational communication. It’s a new phase in corporate America that’s going to demand a lot of communication, including counseling leaders with messages they may not want to hear. Let’s start with what’s happening. Layoff announcements have surged to levels we haven’t seen since the pandemic. According to CNBC earlier this month, we’re seeing cuts across a broad range of industries and companies

suggesting something sort of systemic is at play. And it’s not happening in isolation. It’s coinciding with a shift in tone that CEOs are using when they talk to employees. What we’re seeing is a shift from a seller’s market to a buyer’s market. You may remember it hasn’t been all that long since executive messaging was all about bringing your whole self to work and prioritizing mental health and building workplaces centered on empathy and inclusion.

Those days are fading pretty quickly. Axios recently dubbed it the return of the Big Boss era. CEOs are dropping that therapeutic language of 2020 and embracing what one commentator called masculine energy. It’s less, we’re all in this together and more, step it up or step out. This isn’t just about bravado. There’s calculation here. This new tone serves multiple audiences.

not just employees, but investors, board members, and political stakeholders. This is, remember, Trump 2.0, where radical transparency and performative toughness are in vogue. Some CEOs see value in being leaked when they talk like this. It’s internal messaging with an external target. But let’s dig a little deeper on these layoffs. An analysis from the Wharton School points out that what we’re seeing isn’t just a response to economic turbulence or pandemic

era over hiring, companies are bracing for long-term changes, slower growth, productivity gains they anticipate they’ll get from AI, and increasing shareholder pressure for efficiency. Some organizations are trimming fat, others are actually cutting muscle and hoping automation or restructured workflows can pick up the slack. Neville, before I list some of the things communicators should be thinking about,

What are your thoughts on these trends? I read recently the companies in the UK are laying people off and UK firms are planning more, though I don’t know if CEOs have shifted their tone in their conversations with employees.

@nevillehobson (02:42)

will likely pick up a bit as events shift and change globally. But the main reason I see being mentioned, a couple of pretty good articles recently point this out to toxic workplace culture is the big driver behind employees quitting, not being laid off. There’s a big difference. They’re resigning. So

Not quite the same landscape shell, but it seems that the result is similar, i.e. people are going to be without jobs.

Shel Holtz (03:34)

middle managers revert from the coaching and mentoring style that’s been in vogue for good reason for the last several years toward that just be the boss and tell you what to do and yell at you when you don’t do it right or fast enough. So the toxic workplace could be on its way back to the U.S.

@nevillehobson (04:13)

Yeah,

I wonder though, the reality of that, given what you mentioned is on the decline since 2020 was was how you framed it, the kind of more kinder concern for employees well being and all that kind of stuff. And it’s gone out the window in America, I see this being talked about quite a bit. Not yet here in the UK. And I put I insert the word yet because

I think it’s likely to be the case, I wonder, it’s people we’re talking about, right? So you’re looking at, and what you said is absolutely correct. It starts at the top and filters down. So behaviors are influenced by the leadership behaviors, et cetera. And so the manager for a team in an office, that’s not the head office, it’s a branch office somewhere, but the manager there, or even the big department.

is not, I would say, correct if I got it wrong, but it seems to me they’re not going to suddenly, there’s a sudden shift in behavior. This is a gradual thing. Right. So it’s going to be very difficult for some. You could almost equate it to things I’ve seen in the news recently, for instance, in relation to Trump in laying off federal workers. So for instance, people who

Shel Holtz (05:10)

@nevillehobson (05:27)

over what’s happened just over the last few months, that we do have a change that is huge. And I often say to people when we have these conversations, they are increasingly happening even with friends. The first two decades of this century are the golden years when money was cheap, freedoms were huge, you could get on a plane and travel anywhere. And again, in the European context, that’s a big deal. Get on a plane at London and go for the weekend in Prague.

all you got to do is buy your etiquette and accommodation. That’s it. Didn’t need visas. need. Well, you have passport checks if you come to the UK because even within the EU, the UK insisted on that. They really don’t like foreigners, the Conservative Party in this country, seems to me. So they were in charge during nearly all of this time. But I think that those days are gone and we need to be getting used to this. And it is a time of great uncertainty.

in the workplace. So we hear about uncertainty in stock markets and people thinking, how do I price my goods? Do I have to increase it or what? Here we’re seeing something else that is likely to be of concern to people. It’s a very uncomfortable time for everyone. And indeed, I don’t envy the kind of middle manager in an organization who’s responsible for a team of 20, let’s say, and he’s being told to do certain things that are against his beliefs. What’s he or even she going to do about that?

There is the dilemma.

Shel Holtz (07:09)

And I think that’s a real consideration here for communicators as they think about how they’re going to navigate through all of this. What’s going to happen is you’re going to see as, mean, imagine being a meta employee right now, because say what you will about Mark Zuckerberg. He did champion liberal causes and he created a workplace culture of, I mean, it was a culture of trust. He and Sheryl Sandberg,

used to tell deep secrets in all employee meetings and they never leaked because employees knew that if that information leaked, they’d stop having this information shared with them. Now he’s embraced this, know, masculine culture. He’s obviously pandering to Trump. And what is that tone going to do to the way he perceives employees, the way he treats employees?

how it affects the culture. The best people in any organization are the ones who can say, I’m done and find a job somewhere else. The mediocre people in the organization are the ones who can’t find a job anywhere else. They’re the ones you end up stuck with. So I think the short-term benefits these CEOs may see from becoming the tough boss again.

could evaporate when people aren’t going to continue working for you who you need and you can’t recruit because your employer brand has gone down the toilet.

@nevillehobson (08:59)

I saw a news story today in one of the tech journals that made the comment that Zuckerberg had done the deal with the devil and what has he gotten in return? Absolutely nothing. So what does that mean? So this uncertainty continues in this area, but I think trust is evaporating fast from big companies. And equally, I did read something a week or so back.

It’s actually very relevant to what you said about Zuckerberg and the culture he developed with Sheryl Sandberg. He got rid of Sheryl Sandberg. I think he threw her under the bus, if you remember. Right. And say the DEI stuff was all her. He didn’t agree with it, blah, blah, all that kind of talk. So would you trust him? I certainly wouldn’t if an employee. So you’re going to get people right. So this is likely to be the case in many more organizations. And that’s a very alarming picture, I think.

Shel Holtz (09:47)

No, not even a little.

So let’s take a look at what this means for organizational communication professionals, because I hate to throw a cliche out there, but it presents both a challenge and an opportunity. We are the voice of the organization. We keep the narrative and we facilitate the internal dialogue if we’re doing our jobs well. So what role should we be playing in navigating these particular waters? Well, first we need to be advocates for transparency and clarity.

This is nothing new, but when layoffs happen, the way they’re communicated is paramount. is, we’ve been talking about this for probably 50 years in terms of communicating layoffs in such a way that it leaves the workforce that remains productive and optimistic about the future. Employees deserve more than legal precision when they’re told what’s happening. They need context.

They don’t need vague, you know, we’re realigning with strategic priorities language, but actual explanations. Why are we doing this now? What’s next? What does this mean for us who are still here? know, ambiguity breeds anxiety and erodes what? It erodes trust. Second, we have to be sense makers. The survivors of layoffs are likely feeling a mix of emotions, fear, uncertainty, guilt.

We need to actively listen to their concerns and provide channels for them to voice these feelings. This isn’t a doom and gloom message. It’s a reality check. Workplace toxicity, as we mentioned earlier, is creeping back into the workplace. A recent Investopedia report showed a significant number of employees feeling that work environments have become more hostile, less safe to speak. That is, no psychological safety or reduced psychological safety. And they become more cutthroat.

If we’re not creating channels to surface those feelings, we’re not doing our jobs. Third, communicators have to coach leadership on consistency. As an article in Axios points out, employees are remarkably attuned to tone. If we’ve gone from we support you to produce or perish, then leaders need to own that change. They can’t pretend the vibe hasn’t shifted. When the tone of leadership changes overnight and this tone from leadership has changed overnight.

People start wondering, who is this person? Is this the same guy I signed up to work for? That disconnect can unravel trust faster than a layoff could. Fourth, we have a crucial role in shaping the internal narrative. In the wake of layoffs and the shifting leadership tone, it’s easy for negativity and toxicity to creep in. We need to find ways to preserve culture when leadership is, intentionally or not, undermining it.

That might mean emphasizing peer stories, championing middle managers who are under enormous pressure, or quietly maintaining the threads of the pre-layoff values the company once celebrated. And let’s not forget about Gen Z. They’re watching all this unfold and they’re drawing conclusions. A Fortune article from late last year pointed out that many young professionals are actively avoiding middle management roles. They don’t want to become managers.

It’s not because they’re lazy, it’s because they see those positions as stressful, thankless, and misaligned with their values. In an environment of layoffs and perceived shifts in leadership attitudes, retaining talent, especially younger generations, is going to require a more nuanced approach. This is the time to reaffirm that communication is not just a soft skill, it’s a strategic imperative.

@nevillehobson (13:38)

Shel Holtz (13:41)

The way we approach these challenges will have a lasting impact on our organization’s reputations inside and out, but let’s not shy away from having those difficult conversations. Neville, thoughts?

@nevillehobson (14:17)

Caroline Levitt, Trump’s press secretary, who is so, it’s like a mini me of Trump in behavior. Black is white, white is black. the most untrustworthy individual I’ve ever seen with a blonde hair and a nice demeanor, but I wouldn’t trust that person at all. You would be very worried if your CCO was like that. Also, if you’ve got a CEO like Jamie Dimon, remember we talked about him.

in episode 451 when the speech, the rant peppered with bleeped out expletives on a, what do call it, a meeting with employees was leaked, basically saying, my way or the highway, he didn’t give a damn. And if you got CEO like that, yeah, you’re in trouble.

Shel Holtz (15:16)

wanting to be leaked and heard by the president, right?

@nevillehobson (15:22)

by leaders and organization leading to employees being let go. So layoffs, redundancies, as we call them here in the UK, because the distinction here, of course, is you are not fired, your job has been eliminated, therefore there’s no role for you anymore. So your job has been made redundant, you’re gone. So we’re likely, I wouldn’t be surprised to see this sort of uncertainty continuing and worsening.

communicators. Yeah, all those things you mentioned, Shell. I think when I was looking at what’s happening here in the UK, I mentioned that I did encounter one report that was in HR director magazine that was just a couple of weeks, a couple of months ago, talking about toxic workplace culture are the main reason behind staff quitting, I resignation employees resigning and going somewhere else.

So there’s a kind of the flip side of all of this is the employee taking the initiative and saying, I’m gone from here. That’s on the increase. So if you tie that with then layoffs and redundancies, the workplace is not looking very secure at all for anyone.

Shel Holtz (16:43)

their employment. So lots of reasons for communicators to be listening, to be sharing what they’re hearing with leadership and counseling leadership on how to communicate through all of this in a way that maintains a level of productivity, but also maintains that employer brand so that people want to work for you.

@nevillehobson (17:27)

I would argue is where they are with setting policy and setting behaviors and communicators communicate that and maybe help shape the messaging around that. So in addition to that list of things you mentioned, I would add you need to be hand in glove with your HR side because they will know things you don’t know and you need to know and they may not be proactive. They may be all scared sitting in a corner of cells even. So there’s that, that’s key to it. And the other thing I would argue is that

all you’ve known so far on how you address these sorts of issues probably needs rethinking now in light of what’s happening. Because all the stuff I read and that I know of and you will be the same, I’m sure, is to find and fine tuned over years in times that are not like this at all, where trust is gone completely. And again, just reflecting back on Edelman’s trust barometer.

we’ve seen kind of warning signs in some of the research from that recently, that this, you know, things like, for instance, how leaders can shape workplace culture, the company’s ethos and leadership training, all those things are great. But for circumstances like this, there’s something else needed more than that, I would say. They talk about a thriving workplace is where toxicity is neither tolerated nor ignored. Difficult.

if the leadership is involved in that, eg, Jamie Diamond, JP Morgan, instance, who is fostering a climate of toxicity, then then that’s real tricky. So this is where going back to the role of the communicator. That’s where some very creative thinking and behaviors need to be put in place, which may not be something you’re used to. So communication leadership is the key to that, I would say. So interesting time. I mean, you mentioned

The cliche, know, threats and opportunities, this is opportunities, I see it, but it’s an interesting time we’re in and it’s going to be especially interesting in the coming months.

Shel Holtz (19:37)

and need communications help in explaining why. mean, there are things that happen in the workplace that employees don’t like and there’s things you can’t do about that. Your job isn’t to make employees happy, it’s to help them understand why this is happening, where they fit in a solution, where we’re going from here. communicators can’t just be sitting on their hands, know, cranking out articles about the company picnic. We need to be in the thick of this strategy.

@nevillehobson (20:21)

Shel Holtz (20:24)

@nevillehobson (20:27)

The post FIR #460: The Return of Toxic Workplaces and the “Big Boss” Era appeared first on FIR Podcast Network.