Layoffs might make headlines, but the real measure is how leaders support the remaining employees. Layoffs are undeniably challenging for good reason. However, it’s what leaders do in the aftermath that determines whether a culture fractures or recovers.
I’ve led workforce complex reductions at Amazon, Microsoft, startups, and PE-backed firms. While every situation was unique, the same pattern appeared each time. It wasn’t necessarily the layoff that broke the culture. It was the leadership response.
Layoffs disrupt the culture and impact more than just headcount. I’ve watched talented, engaged employees turn quiet and withdrawn after layoffs. Not because they stopped caring, but because they stopped feeling safe.
The aftermath of layoffs can be unsettling for those who remain. Organizations expect survivors to absorb heavier workloads while they navigate shaken trust and mixed emotions. Layoff survivors often experience relief, guilt, grief, and anxiety about what’s next. This is the leadership moment too few prepare for. Post-layoff culture recovery isn’t automatic—it’s intentional. In these moments, they need to communicate. It’s a make-or-break opportunity to rebuild confidence, reinforce values, and heal a company’s culture.
Culture recovery hinges on many factors. Leadership must step up to manage the aftermath. Here’s how to approach it:
Lead with candor, not corporate speak
Layoffs are typically a financial decision, but culture recovery is a leadership decision. Don’t miss your moment. Layoffs don’t kill culture. Neglect does. Leaders who avoid the hard conversations, hide behind jargon, and pretend it’s business as usual are the ones who lose the trust of their employees. After all, silence creates speculation.
That’s why it’s important that leaders directly address and over-communicate early. I’ve introduced pulse checks, frequent town halls, and open forums. You can’t rebuild morale through Slack updates or pizza parties. You need to do this in an authentic way.
When my company had to conduct layoffs several years ago, it was a stressful experience. As the HR leader, I carried a significant emotional burden in conversations with employees who were impacted as well as those with those who remained. Our executive team met with staff to answer tough questions and provide updates.
The first few sessions were a bit tense for both me and our leaders, as we faced some tough questions. We stumbled at first with too much corporate speak, and employees saw right through it. The room was tense. But eventually, that discomfort became a turning point when leaders stopped with the jargon and started showing real vulnerability. After that, the dynamic shifted. Acknowledging the emotional climate is important because it helps us reclaim performance and commitment. If we wanted to show our support for employees, we needed to address these issues head-on.
Many companies carefully plan their layoff process, including announcements and severance packages. However, they often neglect what comes next. People don’t remember the slide decks or talking points—they remember how you showed up at this moment. Empty buzzwords do more harm than good. Speak to people on a human level and create space for honest conversations about what is certain and what’s unknown. Be open about changes involving the business, team structure, available headcount resources, or ongoing uncertainties. Reaffirm what hasn’t changed. At the same time, you also need to be clear about the path forward.
Create safe spaces for emotion
After layoffs, the workplace feels different, and pretending otherwise only deepens the sense of unease that employees feel. Leaders who acknowledge this reality set the stage for recovery. To help teams reengage, you need to take the time to listen to your employees. When you give people this kind of face, they’re more likely to adapt more quickly and regain momentum.
Validating emotions doesn’t weaken performance—it accelerates it. Employees who feel like you’ve heard them are far more likely to reengage, contribute, and collaborate. Weekly check-ins become vital for building connections. These conversations are not always easy, but they’re necessary for healing. Over time, that openness strengthens collaboration and restores trust.
Rebuild culture from within
Rebuilding from within starts with clarity. Employees need context—why you made certain decisions, and what resources are available moving forward. People want details that help them understand what’s ahead and how their work fits the bigger picture.
This is also the moment to reenergize the team. Reaffirm the mission and values so employees can reconnect to a shared purpose. Even in uncertainty, knowing the “why” behind the work helps people stay motivated.
Leaders need to act. Retaining key talent, ensuring workloads are sustainable, and recognizing the additional effort required of those who remain all demonstrate that leadership is paying attention.
A common mistake leaders make is assuming that the remaining team members will just pick up the slack. This assumption can lead to increased burnout or, even worse, the loss of valuable talent. A better approach is prioritizing tasks, eliminating low-value work, and having an honest conversation about the short-term trade-offs that are involved.
Recognize that this is a cultural moment
Layoffs test culture. They don’t automatically destroy it—what damages culture is indifference, silence, or meaningless lip service. When leaders respond with honesty and care, disruption can become a catalyst for renewal.
You shape culture through daily choices: the courage to answer tough questions, the discipline to maintain consistent communication, and the humility to admit when you’ve compromised trust. Employees notice whether leadership avoids the hard truths or embraces them.
Moments of disruption invite reflection. Leaders can use this time to reassess values, address blind spots, and strengthen practices that they might have overlooked. Openness about what needs to change prevents damaging back-channeling and reinforces inclusivity.
Culture is the foundation on which every company rests. If it fractures, performance and morale follow. But a stronger culture can emerge when leaders step into this moment with honesty and courage.
The extended deadline for Fast Company’s Most Innovative Companies Awards is tonight, October 14, at 11:59 p.m. PT. Apply today.
