Downsizing: employee threat or opportunity?

Abstract

This paper reports on a study of the employment implications of different downsizing approaches using 19 case studies of Belgian organizations recently confronted with downsizing. Based on the results of this empirical study, a two‐dimensional categorization model is developed. The first continuum of the model represents the timeframe (reactive to proactive) of downsizing strategies, while the second continuum represents the focus of reorientation practices towards the internal or external labour market. Based on this categorization scheme, the employment implications were explored. Further theoretical, managerial and governmental implications are also suggested.