Workforce reduction and job-seeker attraction: Examining job seekers' reactions to firm workforce-reduction policies

Empirical research and narrative reports from working managers suggest that employee attitudes can be negatively influenced by organizational downsizing, but the potential impact of downsizing on applicants is not well documented. In this study, we investigate the effect of organizational downsizing on job-seeker attraction to an organization. Respondents were given descriptions of two organizations, coupled with information on workforce reductions in the two organizations. We found that workforce reductions reduced job-seeker attraction. However, companies that downsized but provided assistance and adequate communication to employees were nearly as attractive to applicants as companies that had not downsized. Managerial implications of these results are provided.