In horizontal layoffs, usually a lot of talented people and even turn-key teams are available on the market.
Sometimes companies try to turn horizontal layoffs vertical by offering internal mobility for high performers from the cut teams, but sometimes they don’t.
Publicly stating that layoffs are purely vertical is very bad for the employees who are laid off as they no longer re-apply with the “benefit of doubt” that they may have been caught as collateral damage in horizontal layoffs.
You can have plenty of people who are very good at a skill you either don’t need or have an oversupply of bus numbers on. At least a third of the people in any group you shut down completely are going to have been good people. More than half if the problem was in management (which is usually is).
You’re dunking on these people and telling the rest of the universe not to hire them. But we already knew Google was shitty so this isn’t exactly news.
Going from 5% to 10% might be leverage in the market, but you were still going to limp along anyway. When I’ve been at startups trying to do things like this, it’s very clear that the investors have in their head some notion of multiplying your profits. Every company I worked for that pulled this ended up cutting to the bone later. I don’t think that’s a coincidence.
These days I’m not sure labor is a big enough part of the cost mix for a 10% layoff to actually show up as 5% margin. I pulled that out of my butt and now I’m having second thoughts.
"With the exception of companies going under or closing divisions or departments what kind of companies shave off “high performers”? "
"With the exception of companies going under or closing divisions or departments what kind of companies shave off “high performers”? "
And let's not act like you can actually truly quantify employee performance generally. It's largely guesswork and politics in the hands of the said management-who-screwed-up doing the layoffs.