Quiet Cutting: Are Role Reassignments the New Layoffs?

Key Takeaways

• Nearly 1 in 4 business owners engaged in the practice of quiet cutting.
• On average, business owners who practice quiet cutting end up firing 34% of reassigned employees.
• 39% of quietly cut employees quit, and another 28% plan to.
• 56% of employees would prefer to be fired instead of quietly cut.

The practice of “quiet cutting” has been stirring up conversations in the business world. Quiet cutting involves employers reassigning employees to different roles, hoping they will quit independently, thereby saving the company the cost of severance. To dig deeper into this approach to layoffs, Zetwerk surveyed 414 business owners and 601 employees from various industries. The results offer important insights into how quiet cutting affects today’s workplace.

Business Owners’ Perspectives on Quiet Cutting

Business owners are both leaders and decision-makers when it comes to complex human resources practices like quiet cutting. The following survey findings shed light on how business owners perceive and implement quiet cutting in their organizations.

Nearly 1 in 4 surveyed business owners admitted to using quiet cutting methods. The most common reason for using the strategy was performance management (73%), which may explain why businesses quietly cut entry-level employees (53%) and mid-level workers (40%) most often. To enact the practice, reassigned employees were most frequently moved to less strategic and visible roles (35%), call center jobs (35%), and positions with non-traditional hours (33%).

Business owners also quietly cut employees to cut costs (42%), but the method was not always successful. Business owners who practiced quiet cutting still had to fire 34% of reassigned employees. As a result, only 30% of surveyed owners viewed quiet cutting as a sustainable strategy.

Furthermore, only 25% of all business owners surveyed thought quiet cutting was more effective than hiring new employees, and 80% believed offering severance was the more professional approach. Despite doubts about the practice, 13% of all the surveyed owners anticipated making more quiet cuts by the end of the year.

While quiet cutting has its proponents, 76% of business owners did not use the practice. Reasons for not quiet cutting were deeply rooted in company culture and ethics, with 68% of non-participating owners valuing transparent communication with employees. Another 54% of owners viewed quiet cutting as unethical and against company values.

Business owners also championed management skills to improve employee performance instead of reassigning underperforming workers. Over 2 in 5 surveyed owners preferred regular evaluations and feedback, and 34% prioritized training and support.

Owners were also concerned about the impact of quiet cutting on employee morale and the company’s reputation. Of business owners who quietly cut, 42% were concerned the practice might negatively impact their business and future hiring. Saving money on severance packages may not outweigh the costs of a tarnished image or potential legal repercussions, not to mention the costs of replacing employees.

The Impact of Quiet Cutting on the Workforce

Employees are the backbone of any business, and, as such, business owners would do well to consider how practices like quiet cutting affect their workforce. The following survey findings reveal how employees across various industries feel about quiet cutting and its impact on morale.

Quiet cutting is not rare among employees: one-third of employee respondents had been quietly cut, and one-half knew a co-worker who had been subjected to the practice. The experience was also shared across generations, as 36% of Gen X, 34% of millennials, 30% of Gen Z, and 20% of baby boomers had been quietly cut.

Among employee respondents who were quietly cut, 62% disliked their reassignment. The experience was so bad for 39% that they ultimately quit, and another 28% were planning to. But they weren’t going quietly: 28% of quietly cut employees left a negative company review after the experience.

The negativity also extended to co-workers still at the company, as 62% of respondents who saw co-workers quietly cut said it made them feel negatively toward their employer. Overall, half of employees who saw quiet cutting in their workplace felt betrayed by their employer, and 47% were motivated to leave.

Surprisingly, there were a few benefits for some quietly cut employees, as 57% learned a new skill in their reassigned role. A lucky 15% were reassigned to a higher position, and an even luckier 9% received a raise.

That said, when given a choice, 56% of all employees would rather be fired outright than quietly cut.

Employee Views on Quiet Cutting Across Sectors

Our final findings unpack survey results by industry, offering a sector-specific look at how employees feel about quiet cutting.

The frequency of quiet cutting varied by industry; information technology had the highest percentage of quietly cut employees at 38%. IT also had the highest awareness of colleagues being quietly cut (51%), suggesting a more widespread practice.

Retail had the second-highest rate of quiet cutting at 37%, followed by education at 30%. Health care and engineering/manufacturing saw the least quiet cutting at 25% and 24%, respectively.

As for employee feelings on quiet cutting, workers in the retail sector were the most likely to prefer firing (67%) over quiet cutting (33%). More than half the workforce in other industries agreed, but employees in health care viewed both practices equally.

Navigating the Complexities of Quiet Cutting

Quiet cutting has become a significant concern for employers and employees alike. Our findings highlight the need for transparent communication and ethical practices in workforce management. Business owners can retain talent and maintain company morale by prioritizing training and regular performance reviews to support struggling workers.

When termination is unavoidable, owners should be honest and straightforward with employees. Ultimately, the cost of paying out severance will likely be less than the negative impact on employee morale and company reputation.

Methodology

Zetwerk surveyed 414 business owners and 601 employees about quiet cutting. Among employee respondents, 36% worked in information technology, 27% in engineering/manufacturing, 11% in health care, 8% in retail, 8% in education, and the remainder in other industries. The generational breakdown among employees was as follows: 7% baby boomers, 24% Gen X, 52% millennials, and 17% Gen Z.

About Zetwerk

Zetwerk is a leading global manufacturing platform that simplifies outsourcing for businesses across various sectors. Leveraging advanced technology and a vast network of trusted suppliers, Zetwerk delivers efficient, high-quality manufacturing solutions tailored to each client’s unique needs.

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