64% of employees no longer trust their companies after mass layoffs

Employees in nearly every industry are worried they'll join the growing tally of workers that have already lost their jobs in 2024 — and it's costing them the faith they once had in their employers. 

Sixty-four percent of employees have lost trust in the stability and security of full-time employment because of layoffs in what is being referred to as "The Great Betrayal," according to a recent survey from AI-driven contracting platform A.Team. As a result, less than half of laid-off workers are looking for another job in the same field and 26% are pivoting to an entirely new field. 

"A lot of conversations happen after layoffs," says Kenna Meyerhoff, head of people at A.Team. "For employees, their biggest takeaway has been that they no longer feel like they need to be dedicated long term to employers, especially given the fact that they never know what's going to happen, no matter how loyal, how dedicated, or how much of a high performer they are." 

Read more: Workers are terrified of layoffs, AI and a recession in 2024

Despite how they feel about employers, the workforce hasn't lost faith in having fruitful careers. Seventy-three percent of employees said that the waves of layoffs over the last two years have made freelance work more attractive than before, according to A.Team's findings, with 86% saying they would like to have more control and flexibility over their work schedule than traditional full-time employment can offer. A quarter of survey respondents said they have already turned to freelancing or starting their own business in the wake of layoffs. 

"Employees want to be doing great work and they want to work with people who they like working with — they just don't want to feel like their lifeline is based on one employer," Meyerhoff says. "It has become obvious to employees that they can instead sell their skill set to a company for a period of time or a specific project, and still make good money while doing the work they actually want to be doing." 

The uptick in freelancing in the aftermath of mass layoffs doesn't just benefit employees, according to Meyerhoff, it's good for organizations, too. According to a cost analysis from executive search service McDermott and Bull, the expense to lose and replace an employee with a salary of $70,000 is nearly $92,000. To reduce the risk of losing money, an organization will often be less open to hiring at scale or filling the roles they have open at capacity, Meyerhoff says, which in turn overworks employees, promotes high turnover and hurts their bottom line. Having more access to freelancers could be a cost-efficient option for employers. 

Read more: Life after layoff: How this tech worker moved on and became his own boss

"Employers need to get behind the notion that freelanced or agile teams are an amazing opportunity to set their companies up for success," she says. "They can hire people to do specific things or solve a specific need and create an environment they want to work in without promising them anything that may not come true." 

And while layoffs are not new to the workforce, Meyerhoff suspects that the rise of freelance work is here to stay this time around. So as employees and employers navigate the recruitment and retention process after a season of layoffs, she urges companies to revisit their hiring strategies to ensure that they're prepared for the new needs and wants of workers. 

"It's the right way to go," she says. "People just want to have the flexibility and the ownership over how they're spending their time and effort, both from an employee and an employer standpoint. And that's going to continue, no matter what."