Downsizing by employers is leading to a dive in staff morale and is failing to increase productivity, a Drake International survey has found.
A survey of 6,300 employees and managers who have experienced downsizing in their workplace found 40 per cent of staff became less motivated afterwards, while productivity improved in just 21 per cent of cases.
Drake strategic manager David Edwards said employers were doing themselves long-term damage by not managing downsizing effectively.
"Only one year ago employers were investing heavily to attract new staff to deal with critical skills shortages," he said in a statement on Monday.
Mr Edwards said, "organizational restructure should be about working smarter by changing processes and redesigning job roles." Downsizing should be an opportunity to improve productivity and reduce waste, not just cut costs.
"This survey reveals that most employers expected to achieve downsizing benefits by asking staff to work harder."
The survey found that although many employers were changing processes and job roles, productivity increased in only 21 per cent of cases.
Mr Edwards said the main cause was the lack of investment in retraining with only 14 per cent of employees receiving training after the restructure.
The survey also found 41 per cent of remaining staff lost their respect for their employer and 46 per cent were less likely to recommend their organization to a job seeker after downsizing.