Comment on "Announced lay-offs: Their effect on corporate financial performance"

✍ Scribed by Lawrence Haar

• Publisher: John Wiley and Sons
• Year: 1999
• Tongue: English
• Weight: 120 KB
• Volume: 38
• Category: Article
• ISSN: 0090-4848
• DOI: 10.1002/(sici)1099-050x(199923)38:3<255::aid-hrm7>3.0.co;2-j

✦ Synopsis

The impact of employee lay-offs on business performance is of great concern to human resource managers as well as to the wider community. In a recent article by De Meuse, Vanderheiden, and Bergmann, published data are analyzed to determine whether announced lay-offs lead to improved financial performance. Their results support the view that from the standpoint of business performance, lay-offs are ill-advised. The methodology used, however, as it does not consider risk, reduces the significance of their findings. Accepted financial theory, moreover, suggests an alternative explanation of their results.