Getty Images; Tyler Le/BI
- Companies like Amazon and Microsoft have recently conducted multiple rounds of layoffs.
- This approach can prolong uncertainty and anxiety among employees, potentially leading to burnout.
- One-time reductions can limit the blow to morale, but companies also risk cutting too deeply.
The good news: You didn’t get laid off. The bad? You might be cut next month.
Some large employers are now embracing recurring job cuts rather than axing a bunch of workers all at once. That can help companies avoid cutting too deeply and minimize disruption.
Yet drawn-out cuts can prolong workers’ unease, pulverize morale, and make it harder for leaders to rally teams to move in a new direction.
Companies, including Amazon, Google, and Microsoft, have recently made cuts in stages.
Amazon, which this week said it was laying off 14,000 employees, expects that in 2026 it will uncover “additional places we can remove layers,” and “realize efficiency gains.”
Paramount, following its August merger with David Ellison’s production company, Skydance, said this week it would cut about 1,000 employees. That’s only about half of the expected reductions, a source familiar with the company’s plans previously told Business Insider.
Translation: More cuts are likely.
Amazon declined to comment, and Paramount Skydance didn’t respond to a request for comment from Business Insider.
“We’re seeing a lot more of this drip-drip, which does cause uncertainty,” Carly Holm, founder and CEO of the consulting firm Humani HR, told Business Insider. “It’s not ideal.”
The forever diet
Layoffs have, in some cases, become a form of corporate preening — a way to demonstrate that those in charge are avoiding bloated org charts or feeble business lines, especially after turbo-charged hiring during the pandemic in industries like tech.
Companies have also simply grown accustomed to routinely shedding workers, said Matthew Bidwell, a management professor at the University of Pennsylvania’s Wharton School.
“They may not have quite the same sense of, ‘Gosh, this is bad, so let’s just do it once and do it big,'” he told Business Insider.
And with the job market cooling, Bidwell said, bosses don’t have to worry as much that workers who remain will feel free to walk away.
Many CEOs’ thinking about layoffs has shifted over the decades, he said. Prior to around 1980, Bidwell said, employers tended to furlough workers, such as those in factories, when demand slipped, with the intention of hiring them back once things picked up. Layoffs, particularly among white-collar employees, were seen as a last resort, Bidwell said.
“The big change today is, ‘If we think it might raise profits, we’re going to do it,'” he said.
Brooks Holtom, a professor of management at Georgetown University, said that researchers have found that layoffs can decrease creativity among workers who remain, and increase their stress and rates of burnout.
That’s why, he told Business Insider in an email, it would be “much better” to make one-time cuts rather than spreading them out.
Another reason employers might prefer one big swing: People start leaving after layoffs. Research has shown that the share of workers who quit tends to increase by about 50% in the year following a layoff — and often the best performers are among them because they have options.
Reasons to go slow
While it can be disruptive to workers, it’s easy to see why CEOs might not want to swing the axe all at once. If they overshoot, they risk having to hire again, and few things signal instability like a whiplash hiring spree.
Getting the cuts over with might help morale and trust bounce back sooner, yet the approach also brings risks, said Sarah Rodehorst, cofounder and CEO of Onwards HR, which helps large companies stay compliant with regulations when laying off employees.
In a moment when everything from AI to tariffs to government spending cuts is making decision-making difficult, there’s a danger in cutting too quickly.
What a business needs today could look very different six months from now, Rodehorst said. Plus, slashing too many people at once can make it harder to reassign work and rewire the organization’s operations.
“The business may need people for a period of time as part of that restructure,” she said. “So, it’s hard to let everyone go all at once.”
The risk, of course, is that the people left behind spend more time wondering if they’re next rather than focusing on their jobs.
Much as CEOs overseeing the cuts might wish it, the period after layoffs isn’t exactly “innovation and growing-the-business time,” said Scott Kirsner, CEO of InnoLead, a research firm focused on corporate innovation. Instead, he said, teams tend to be busy figuring out who’s managing whom and what the company even looks like now.
Bidwell, from Wharton, said that big cuts often create “huge turmoil” and that trying to avoid layoffs for several years can require leaders to make big predictions about what a business will need in the future.
Even so, he said, the idea that businesses can simply cut and rehire as needed overlooks the hidden drags — things like damaged morale, lost institutional knowledge, and the time it takes new workers to get up to speed.
“There are serious adjustment costs every time you bring new people in,” Bidwell said.
Besides, he said, while it’s easy to tally up the salaries of laid-off workers, “it’s a lot harder to assess the challenges that you’re going to face in continuing to motivate your people and getting the work done.”
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