A new study from Careerminds, a leading global workforce solutions provider, reveals that layoffs can create significant reputational risks for employers long after workforce reductions occur. Nearly 70% of employees say they have shared or would consider sharing their negative layoff experiences on public platforms such as LinkedIn, Glassdoor, or Reddit.
The findings are part of Careerminds’ new report, “The Hidden Costs of Layoffs: Planning for the Exit and the Aftershock.” Based on surveys of 500 human resources leaders and 500 employees at large U.S. organizations, the report examines how layoffs impact employer reputation, workforce trust, and long-term employee retention.
The Growing Reputation Risk of Layoffs
The rise of professional networking sites and employee review platforms has increased the visibility of layoff experiences.
Nearly seven in 10 employees (69%) say they have already shared or would consider sharing negative layoff experiences online, meaning workforce reductions can quickly become part of an organization’s public narrative. This growing trend of employees sharing — and even recording — layoff experiences on social media can amplify these moments and shape public perception of the employer.
This dynamic creates what the report describes as the “reputational aftershock” of layoffs — an ongoing effect that can influence how potential candidates, employees, and even customers perceive a company. Looking ahead, the report emphasizes that the way organizations support both departing and remaining employees is critical to minimizing these risks. Clear communication, career transition support, and continued investment in employee development all play a critical role in maintaining trust and reducing long-term risk.
Layoffs Often Leave a Lasting Impression
Nearly six in 10 HR leaders (57%) say their organization is likely to conduct layoffs within the next 12 months, driven by a range of factors, including economic pressures, business strategy shifts, and increased AI adoption.
The study found:
- 39% of employees say layoffs negatively affected their perception of their employer
- 40% of HR leaders report layoffs led to increased voluntary turnover
- More than one in five employees (21%) say they are unlikely to stay with their employer after layoffs occur
“These findings reflect what both job seekers and remaining employees experience after a layoff. It’s not just about losing a job, but how the situation is handled,” said Amanda Augustine, career expert for Careerminds and a certified professional career coach. “When communication is unclear or support is lacking, it can leave professionals feeling undervalued and more likely to share that experience with others. On the other hand, when employers handle layoffs with transparency and provide guidance on next steps, it can make a meaningful difference in how individuals move forward.”
Most Organizations Still Lack Career Transition Support
The report also finds many organizations are not providing adequate support to employees after layoffs. Only 45% of HR leaders say their offboarding process included outplacement or career transition services, even though such support can help employees find new roles faster and reduce reputational risk for employers.
Employees identified clear areas for improvement in how layoffs are handled. The most common responses included:
- More transparent communication (63%)
- Earlier notice or clearer timelines (58%)
- Better career transition support (53%)
“From a job seeker’s perspective, access to career-transition support can be a game changer,” Augustine added. “Even basic resources like resume guidance, interview preparation, and clear direction on what to do next can help people regain confidence and get their job search moving in the right direction, quickly. With the right support in place, people are in a better position to move forward with clarity and land their next opportunity faster.”
The study highlights that while layoffs are often unavoidable, the way they are handled can have lasting consequences for both employer reputation and employee retention. Organizations that communicate transparently, provide career transition support, and invest in the growth of remaining employees are better positioned to maintain trust, minimize reputational risk, and strengthen long-term engagement.
