It's been over two years of rolling tech layoffs now, and I want to talk about something that isn't getting enough attention: the long-term brand damage that companies are inflicting on themselves through how they handle these cuts.
Not the cuts themselves. I'm not naive enough to think every company can maintain headcount through every economic cycle. But the how. The absolute how of it all.
We watched companies lay off thousands via email. We watched them revoke badge access before the Zoom call was over. We watched executives post LinkedIn reflections about "difficult decisions" while their stock comp vested on schedule. We watched the performative grief. The "we're a family" companies that turned out to be families in the mafia sense.
And here's what those companies don't seem to understand: every single laid-off employee is now a brand ambassador, whether you like it or not. They're at dinner parties. They're on Glassdoor. They're at their next company, making decisions about vendor partnerships and contracts. They remember.
And here's what those companies don't seem to understand: every single laid-off employee is now a brand ambassador, whether you like it or not.
I think about this through the lens of what I call "the alumni effect." McKinsey understood this decades ago. Goldman Sachs understood it. The best professional services firms invest heavily in their alumni networks because they know that today's departing employee is tomorrow's client, partner, or referral source.
Tech companies, largely, did not understand this. They optimized for speed and cost in the layoff process and completely ignored the lifetime value of the relationship with the departing person. A severance package is not a relationship strategy. It's a legal settlement.
The brands that handled layoffs well, and there were some, will reap the benefits for a decade. Companies like Airbnb, whose 2020 layoff communication became a masterclass in empathy and respect, are still benefiting from the goodwill that generated. Former employees still speak highly of them. That's employer brand equity that no recruitment campaign can buy.
The companies that handled it badly? They're already seeing it in their recruiting pipelines. The best candidates have options, and they have memory. In a tight market for top talent, your employer brand isn't what your careers page says. It's what your former employees say at happy hour.
If you're a brand leader at a company that laid people off badly, the window to repair that damage is closing. Not with a LinkedIn post. With action. Alumni programs. Genuine re-hiring priority. Reference support. The things that cost effort, not just money.
Because memory is the one thing you can't optimize away.