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Layoffs Don't Work
Yet companies keep using them over and over.
In the middle of the 20th century, as America entered an era of unprecedented prosperity, influential companies practiced a form of capitalism that balanced profits with employee welfare and the public good. As companies sought to rebound from a nationwide economic funk, they began practicing a more rough-and-tumble capitalism that prized shareholder value and ushered in a “free agent” model of employment. “All of a sudden,” David Gelles, author of the Welch biography The Man Who Broke Capitalism, told NPR, “other CEOs saw that…if we rapidly wind down the cost of our labor, we could potentially see a meaningful increase in earnings per share for the next quarter and Wall Street sure liked that.”
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