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8 - Executive perceptions

Probing the institutionalization of organizational downsizing

Published online by Cambridge University Press:  05 July 2014

By
William Mckinley  and
Jasmin Chia-Jung Lin
Edited by
Cary L. Cooper ,
Alankrita Pandey  and
James Campbell Quick
William Mckinley
Affiliation:
Southern Illinois University
Jasmin Chia-Jung Lin
Affiliation:
Robert Morris University
Cary L. Cooper
Affiliation:
Lancaster University
Alankrita Pandey
Affiliation:
University of Texas, Arlington
James Campbell Quick
Affiliation:
University of Texas, Arlington
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Summary

Introduction

Organizational downsizing surrounds us. There was a significant surge in organizational downsizing in public sector organizations in the late 1970s and early 1980s (Bozeman and Slusher, 1979; Glassberg, 1978; Levine, 1978). In the late 1980s and the 1990s, organizational downsizing also became prominent in the private sector (Freeman and Cameron, 1993). By one estimate (Kozlowski, Chao, Smith, and Hedlund, 1993), 66 percent of firms with more than 500 employees intentionally reduced their workforces during the latter half of the 1980s. During that entire decade, several million manufacturing jobs were lost through downsizing (Kozlowski et al., 1993). According to Littler and Innes (2004), the pace of private sector downsizing in the 1990s was similar, with 68 percent of organizations represented in a 1992 British Institute of Management Survey reporting a delayering or restructuring exercise in the previous five years.

More recently, organizational downsizing has undergone another renaissance in the public sector, with deficit-ridden state and municipal governments in the United States laying off teachers, furloughing workers, and taking other workforce reduction measures in an attempt to shrink the size and cost of government (e.g., Medina, 2011; Otterman, 2011). In Europe, the bursting of the housing and banking bubbles have produced implosions in economies, such as those of Ireland and Spain, and these implosions have led to higher interest rates on government debt, austerity policies, and intense bond market pressure for downsizing of government work forces.

Type
Chapter
Information
Downsizing
Is Less Still More?
 , pp. 228 - 257
Publisher: Cambridge University Press
Print publication year: 2012

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