In the current economic environment, downsizing, layoffs, mergers and bankruptcy are common scenarios in many firms. All these affect the day-to-day life of the employees. Hundreds and thousands of workers have lost their jobs in recent months. Many have either been shifted to new positions with new duties or have had additional duties piled on top of the existing ones. The IT industry is beginning to reek with the detritus of piling layoffs. Trapped in an iron grip of recession, technology companies—ranging from IT powerhouses to smaller organizations—are aping global (read US) corporations and are ruthlessly wielding the axe. This article sheds light on how to manage layoffs at the workplace, the rate of layoffs in the past years, the impact of layoffs on the market value, and how it affects the present decade.

Reducing the number of employees on a company's payroll temporarily is considered as `layoffs'. As there is an economic slowdown, many businesses are being forced to reduce their number of employees to further slash expenditure and bring down overheads. The majority of layoffs are due to a company's desire to lower costs. Usually, there will be employees in positions which are unnecessary thus, allowing the company to do the same amount of work with fewer employees to pay. Layoff is high when employees are not working up to the standards of the company and their competition is more successful. This situation can be prevented if the employees get word of a possible layoff ahead of time, but many a times businesses lay off employees even if they lose profits.

As of April 2007, the unemployment rate in the US was 4.5%, with the largest number from the manufacturing sector. Over 230,000 jobs have been lost in this sector. This includes mining, construction, manufacturing, trade and retail. Most of these layoffs were due to advancements in technology that made many jobs obsolete, as they could now be accomplished by a machine in lesser time. The increase in the number of factories being established overseas is also adding to the number of layoffs in the US. There are a number of key terms associated with layoffs. It may be Involuntary Reduction In Force (IRIF) or Voluntary Reduction In Force (VRIF). In today's job market, it is uncertain who will have a job and who will be laid off. For many unskilled workers, jobs are being taken over by more cost efficient computers that do the same work while increasing the company's revenues and production of goods. Although technology has led to the advancement of many industries, it is posing a serious threat to the blue-collar workers in the country. If these trends continue as they have over the last few years, many of these workers will be permanently out of jobs and unable to support their families. With the exception of Trigyn Technologies and Aztec Software, which are loathe to admit layoffs, most companies have branded employees as non-performers, causing added emotional trauma to the shock of being laid off. In its defense, the IT industry cites the example of US corporations. Not long ago, when the first tremors of slowdown were felt by India IT Inc., Narayan Murthy, Ex-CEO of India's leading IT Company, Infosys, made a statement that IT companies must be allowed to retrench employees at will to remain competitive. In India, where layoffs are a first generation phenomenon, there is a dire need to modify corporate attitude from an arbitrary, at will dismissal, to a sensitively handled retrenchment.

HRM Review Magazine, Economic Environment, Information Technology, IT, Economic Slowdown, Involuntary Reduction In Force, IRIF, Voluntary Reduction In Force, VRIF, Decision Making, Financial Market Turmoil, Managerial Decisions, Digital Technologies.