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Sustainability 2018, 10(5), 1365; https://doi.org/10.3390/su10051365

The Dark Side of Wars for Talent and Layoffs: Evidence from Korean Firms

1
Ewha Womans University and HR Team, Samsung Engineering, Samsung GEC, 26 Sangil-ro 6-gil, Gandong-gu, Seoul 05282, Korea
2
Ewha School of Business, Ewha Womans University, 52 Ewhayeodae-gil, Seodaemun-gu, Seoul 03760, Korea
*
Author to whom correspondence should be addressed.
This paper is an extended version of our paper presented at the International Labor and Employment Relations Association (ILERA) World Congress, Cape Town, South Africa, September, 2015.
Received: 19 March 2018 / Revised: 10 April 2018 / Accepted: 26 April 2018 / Published: 27 April 2018
(This article belongs to the Section Economic, Business and Management Aspects of Sustainability)
Full-Text   |   PDF [298 KB, uploaded 3 May 2018]

Abstract

In this study, we examined the effects of layoffs and wars for talent on firms’ performance. The simultaneous use of layoffs and “war-for-talent” practices has become part of the management strategy for adjusting workforce competencies. We suggest that war-for-talent practices decrease organizational performance when laying people off at the same time. Moreover, we argue that investment in employees’ skill development during the same period as layoffs and a war for talent can enhance organizational sustainability in increasing employee commitment, trust and organizational flexibility. Using a longitudinal survey conducted at over 653 Korean firms by a government-sponsored research institution, the results show that war-for-talent practices do not have a significant impact on firms’ performance. Moreover, our findings indicate a negative relationship between war-for-talent practices and financial performance when conducting layoffs and, as expected, a positive effect of the interaction between a war for talent and layoffs on turnover. Lastly, the results indicate a negative effect on organizational performance in firms pursuing a war for talent is mitigated when investments in employee development are continued during periods of layoffs. View Full-Text
Keywords: war for talent; layoffs; employee development; human resources; firm performance war for talent; layoffs; employee development; human resources; firm performance
This is an open access article distributed under the Creative Commons Attribution License which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited (CC BY 4.0).
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Cho, H.-J.; Ahn, J.-Y. The Dark Side of Wars for Talent and Layoffs: Evidence from Korean Firms . Sustainability 2018, 10, 1365.

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