The layoff notices have been delivered. Impacted staff members worked their final day. And now you are left to decide how your organization will move forward.
For hospitals and health systems, the weeks and months following workforce reductions are a time when good leadership is more important than ever. The decisions you made before announcing cuts and will make during this critical period impact whether your organization will rebound or suffer from declining morale, increased turnover, and compromised patient care.
The psychological impact of layoffs can negatively affect even the strongest workplace culture. According to research cited by the Society for Human Resource Management, layoffs increase the odds of employee anxiety by 139%, employee burnout rises by 158%, and employees’ sense of belonging decreases by 34%.
But healthcare leaders who approach the aftermath strategically can not only stabilize their organizations — they can emerge stronger, more unified, and better positioned to grow strategically and fulfill their mission.
Here are six ways you can support your workforce after a layoff:
How you show up in the initial days after a layoff will set the tone for everything that follows. This is not the time to retreat to your office or work from home. Remaining staff need to see their leaders in hallways, at nursing stations, in break rooms, and on patient floors. Your physical presence sends a powerful message: We're still here, we're in this together, and we're not abandoning you.
As uncomfortable as it may be, make leadership rounding a priority. For nurse managers and department directors, this might mean starting each shift with a quick huddle. For hospital leaders, this might mean rotating through different units each day.
The key is consistency and follow-through. Ask employees how they’re doing and genuinely listen to their answers. Don't rush past difficult conversations. Your clinical staff have spent their entire careers showing up for patients during the hardest moments. Now it's your turn to show up for them.
For employees, RIFS are often perceived as a breach of trust in leadership and the employee/employer relationship. The best way to overcome this perception is through transparent communication. General platitudes about "market conditions" or "operational efficiency" aren’t enough. Instead, be open about the specific financial pressures that necessitated layoffs. Share what alternatives were considered, how decisions were made, and what is being done to drive overall organizational health.
Connect these difficult choices back to your mission. Help your staff understand how these painful decisions ultimately protect the organization's ability to continue providing care to the community. This level of transparency will show employees you respect them and reinforce their role in your journey.
While you can share the logical reasons behind the layoffs, it doesn’t negate the fact that this is a difficult and emotional time for all of your employees. As a leader, you should acknowledge this difficulty without minimizing it.
This is also a good time to emphasize the resources that are available through your Employee Assistance Program (EAP). Services like counseling and peer support can help your staff manage the psychological impact of stressful situations like layoffs. By acknowledging the difficulties they’re facing and even offering expanded support, like on-site counselors to help process the trauma or deal with emotions, you’re also helping to reduce the stigma that’s often attached to accessing mental health resources.
In hospitals and health systems, layoffs affect patient care in ways that staff feel deeply. Don't ignore this reality. Hold conversations with clinical teams about:
One of the most damaging mistakes leaders make post-layoff is assuming their staff will simply absorb departed colleagues' work without clarification. This approach breeds resentment, confusion, and burnout.
Assess what work was being done by departed staff. Then, identify what work can be stopped, delayed, or done differently. Be explicit about these choices and explain the rationale. When work must be reassigned, do it intentionally. Document new expectations in updated job descriptions or written communications. Provide necessary training and set realistic timelines.
As the weeks and months pass, commit to maintaining clear, open lines of communication between leadership and employees.
Uncertainty breeds anxiety in your workforce. The best way for healthcare leaders to combat these negative emotions is through regular communication. Create feedback loops that allow your staff to ask questions and provide answers for everyone to see.
According to the Journal of Occupational Health Psychology, active listening from managers can help alleviate the distress associated with job insecurity after workforce reductions. These findings support the notion that when managers become better listeners, employees feel more in control, which reduces the detrimental impact of organizational change.
Once operations have stabilized, shift your focus to rebuilding engagement and reconnecting staff to their sense of purpose.
Acknowledge the fact that your remaining employees have shouldered enormous burdens. They've absorbed extra work, supported departing colleagues, and continued caring for patients despite their own grief and uncertainty. This deserves recognition.
Share patient stories. Celebrate positive clinical outcomes and patient experience wins. Help staff see how their individual contributions ultimately serve patients and communities.
Whenever possible, offer genuine, public acknowledgement for the staff members who have gone above and beyond. Even small gestures can make a big difference, because they acknowledge that you see (and recognize) their contributions.
At a time when layoffs may challenge their faith in your organization, remember to stay connected to your people.
The path forward won't be easy. Some days will feel like progress; others will feel like sliding backwards. Your remaining staff will have good days and hard days. Patient care demands won't pause while everyone adjusts. Budget pressures won't magically disappear.
But here's what matters: how you lead through this challenging period will define your leadership legacy and your organization's culture for years to come.
Lead with clarity. Communicate with transparency. Support with generosity. And recognize that the mental health and well-being of those who remain is critical to your organization's recovery and future success.