This week I had an interesting conversation with a senior executive about a situation many leaders silently struggle with: what happens when layoffs become necessary, but managers categorically refuse to carry them out?
Layoffs are an emotionally charged topic—especially today. It’s easy to argue that some recent workforce reductions were avoidable, or that people should never be treated like numbers on a spreadsheet. Those points matter. But for a moment, I’d like to examine a specific scenario from the employer’s perspective, with as much neutrality as possible.
The Scenario
A CEO of a mid-sized company reviews revenue forecasts and client prospects for the upcoming year. Based on the numbers, he concludes the company cannot financially sustain its current headcount. To keep the business stable in the long run, he decides a 10% reduction in staff is necessary.
He communicates this to his managers, who immediately refuse to participate. They say they cannot choose whom to let go and don’t want to destabilize the team. Some even claim they would rather resign themselves than fire someone.
It is a complicated, painful situation. No question.
But if you were in the manager’s position—what would you do? Stand firm and refuse? Or work with the CEO to find a solution, even if that solution includes layoffs?
Personally, I’d choose the second option. Here are four reasons why.
1. Layoffs Can Create Space for a Higher-Performing Team
It may sound harsh, but sometimes workforce reductions are an opportunity to address chronic low performance that managers have been avoiding. Protecting low performers for emotional reasons ultimately harms team productivity, morale, and even fairness.
Of course, everyone brings different strengths to a team. But there must be a minimum performance threshold. When someone consistently falls below it, keeping them onboard doesn’t help them or the organization.
And as counterintuitive as it sounds, being laid off can sometimes set a person on a better path. It can be the wake-up call that prompts self-reflection and growth—something that wouldn’t happen if they continued in a role misaligned with their abilities or motivation.
2. A Company Must Stay Profitable to Protect All Jobs
A business is not a charity. It must remain profitable to survive. If the CEO decides to retain the extra 10% of employees purely out of compassion, the company risks financial instability.
And if the company ends up failing altogether, everyone loses their job—not just the 10%.
Sometimes leaders face painful decisions where protecting the whole requires sacrificing a part.
3. Cutting Benefits Instead Isn’t a Long-Term Strategy
Another option managers often suggest is keeping everyone but reducing benefits or salaries. While this might work temporarily, it carries hidden long-term consequences.
Demotivated employees start looking elsewhere. And usually, the first to leave are the best performers—the ones who have options.
Instead of losing the least productive employees, the company ends up losing the strongest ones.
This kind of talent drain is far more damaging than a well-managed layoff.
4. The Business World Is Tough—And CEOs Live Closest to the Consequences
Since becoming a freelancer, I’ve realized how unforgiving the business world can be. Competition, uncertainty, and constant decision-making are the daily reality for business owners. Every mistake has direct consequences.
Employees are often shielded from this. When we make mistakes, we might not get promoted, but our salary still arrives each month. That safety net is a privilege.
CEOs don’t have that shield. Their decisions impact dozens or hundreds of lives. They carry a burden that is rarely acknowledged.
When managers refuse to participate in difficult decisions, they forget this perspective.
Compassionate Layoffs Are Possible
Yes, layoffs damage morale and create feelings of insecurity and even betrayal. And yes, it’s heartbreaking to let go of people you’ve worked with for years.
But with transparency, empathy, and the willingness to explain the “why,” leaders can navigate layoffs in a way that maintains trust and minimizes long-term disruption.
Leadership Shines in Difficult Moments
A leader’s responsibility extends to both the people they manage and the company they represent. Real leadership is tested in situations where interests diverge and emotions run high.
It’s easy to lead when times are good. The true brilliance of a leader reveals itself in harsh waters—when they manage to keep the boat afloat, protect as many people as possible, and steer the organization toward a stable future.
