Cost-Cutting Stated As Top Factor Fueling Layoffs In Second Half Of 2024

As the second half of 2024 starts, 60% of employers expect to have layoffs during that period.

Three out of five companies will likely cut jobs during that period. The finding stems from a ResumeTemplates.com survey of 934 U.S. business leaders to determine how many companies plan to cut jobs. The analysis included 41 Black business leaders.

Business leaders cited cost-cutting (60%), poor employee performance issues (53%), and AI displacing workload (51%) as the top reasons for layoffs. Some 44% of companies expect to terminate 30% or more of their workers.

Several companies in various industries already cut jobs during the first six months of 2024; they include Goldman Sachs, Tesla, Microsoft, and Google.

Executive résumé writer Andrew Stoner of ResumeTemplates reflected on the potential layoffs in a news release.

“Macroeconomic factors such as a drop in consumer sentiment and/or delay in interest rate cuts by the Federal Reserve could be significant factors in layoff decisions through the second half of 2024. Consumer sentiment softened a bit in June. The Federal Reserve has held the interest rate steady for a year now with progress.”

Another pain point: Only 10% of companies offer less than two weeks of severance, making matters more difficult for those possibly facing dismissal.

“In addition to the immediate impacts, such as financial strain, reduced transition time, and loss of benefits, the pressure stemming from limited severance policies can adversely affect laid-off workers,” Stones stated. “This added pressure may lead to diminished performance, increased stress, and a compromised ability to secure a well-suited role with appropriate compensation.”

Conversely, 75% of those quizzed reported that employees with artificial intelligence (AI) skills are less likely to be let go.

“I believe this trend reflects the growing demand for AI skills in today’s job market and employers’ desire to retain AI talent for future business applications and opportunities,”  Stoner explained. “Employees with AI skills have a significant advantage in adaptability compared to their counterparts.”

See more details from the survey here.