Final answer:
Effective management of layoffs during economic downturns involves a cautious strategy by firms to retain skilled workers and minimize hiring new staff, while workers should focus on maintaining good employer relations and utilizing support resources.
Step-by-step explanation:
Handling layoffs effectively is crucial during economic downturns such as recessions or depressions. The process is challenging, both for employers who must strategize to retain key staff and minimize disruption, and for employees who face financial and personal hardships. Employers often hesitate in laying off workers promptly at the onset of a recession, due to the potential need to recruit, hire, and train new staff if the demand recovers. Employees, on the other hand, may experience scanty wage raises or pay cuts, even if they retain their jobs.
To minimize the negative impact, firms may retain workers for as long as possible, sometimes resorting to overtime work for existing staff rather than hiring new employees. This cautious approach helps maintain a skilled workforce and can ease the transition back to full operation when the economy improves. Meanwhile, workers can focus on maintaining a positive relationship with their employer and exploring all available resources to manage this career transition.