Rising layoff anxiety and declining workforce confidence
The tech industry is going through a rough phase, and the numbers don’t lie. Over 600,000 tech employees have been laid off globally since 2022. The result? Workforce confidence has taken a hit. A recent survey by Clarify Capital found that one in three U.S. workers fear layoffs in 2025. Worse, 10% believe they wouldn’t land a new job within three months if they were let go. Glassdoor’s Employee Confidence Index hit an all-time low in February 2024. That’s not a coincidence, people see what’s happening, and they’re worried.
Tech professionals fear unemployment because they feel expendable. Forum discussions and online posts show a growing frustration, constant upskilling, chasing new technologies, and coping with economic downturns are exhausting. CEOs cutting diversity and inclusion efforts, then pushing automation to replace coders, certainly isn’t helping. It’s no surprise that doubt has crept into even the most talented engineers.
Fear leads to reduced innovation, lower morale, and talent flight. If your best people don’t trust in their future at your company, they won’t stick around to build it. The companies that get ahead of this, by providing clarity, growth opportunities, and a vision that employees can believe in, will be the ones that dominate in the long term.
Broader economic conditions contributing to job insecurity
The technology sector isn’t struggling in isolation. The bigger picture matters. Global unemployment is at a record low of 5%, yet hiring rates in late 2024 were at the same level as the early 2010s, during the peak of the Great Recession. This means people are employed, but companies are hesitant to expand their workforces. The International Labour Organization has warned that a global economic slowdown will limit job creation for the foreseeable future. Meanwhile, concerns about an unstable U.S. stock market and a potential recession are making businesses even more cautious.
The decline in hiring is making workers uneasy. According to a Pew Research Center report, slightly more than half of U.S. workers say they would struggle to find the job they want if they began looking today, up from 37% in 2022. LinkedIn’s Workforce Confidence survey found that American workers are now less confident about employment prospects than they were in early 2020 at the height of the COVID-19 pandemic. When confidence drops to this level, it affects how employees approach their jobs. Uncertainty leads to risk aversion, slowing down innovation and internal momentum.
For executives, this signals a major change. You can’t rely on economic recovery to restore stability in your workforce. Hiring strategies and retention plans need to adapt to the reality of slow job creation and cautious market conditions. Companies that provide clear career paths, internal mobility, and skill development will strengthen their workforce without needing aggressive external hiring. Anticipate change, reduce uncertainty, and position your team to move forward regardless of market conditions.
The mental health toll on tech workers and managers
Layoff anxiety is impacting mental health across the industry. Tech workers are reporting higher levels of stress, burnout, and emotional exhaustion. Even those who aren’t directly facing layoffs feel the pressure to constantly upskill, stay relevant, and outperform their peers. The recent shake-ups at major tech companies have only made things worse, creating an environment where employees feel more like short-term resources than long-term assets.
The data confirms what many already suspect. A workplace mental health report by investment firm CCLA ranked major tech companies, Alphabet, Apple, Meta, Microsoft, Nvidia, and Tesla, among the worst in supporting employee well-being. Amazon ranked slightly higher, but still near the bottom. Meanwhile, the impact isn’t limited to individual contributors. A 2023 All Points North survey of 501 U.S. tech leaders found that 38% of managers experienced heightened anxiety or depression due to layoffs. Even more concerning, 77% reported that layoffs had a direct or indirect negative effect on their health. When leadership is struggling, the entire organization feels it.
This is a core business problem with real consequences. When mental health suffers, productivity and creativity decline. Talented employees disengage, make risk-averse decisions, or leave entirely. For executives, it’s important to recognize that a burned-out workforce won’t drive success. Companies that address mental health proactively, provide real support structures, and foster a culture of long-term stability will come out ahead.
The importance of managerial leadership during uncertain times
Strong leadership is invaluable when uncertainty becomes the norm. In times of volatility, employees look to their managers not just for direction but for a sense of stability. Leaders who can keep their teams focused, engaged, and confident will determine whether their companies stay ahead or fall behind.
A key part of this is making sure managers take care of themselves. When leadership is drained, their teams feel it. Laura Nguyen, executive coach and author of Career Break Compass, emphasizes that setting boundaries, taking real breaks, and maintaining personal well-being are non-negotiable. A leader who is constantly in survival mode won’t be able to inspire confidence or bring clarity to those they manage. Executives who prioritize systemic well-being, both for themselves and their teams, will drive sustainable productivity instead of short-term performance spikes followed by burnout.
The numbers reinforce this. A workplace survey by meQuilibrium of over 6,700 employees found that workers who feel supported by their managers are 63% more likely to trust company leadership. They are also 69% more likely to trust their colleagues and more than twice as likely to view workplace conflicts as fairly resolved. These factors determine whether a company remains agile during uncertainty or crumbles under internal instability.
Strategies for managing layoff anxiety in teams
Uncertainty creates fear. The worst thing a leadership team can do is go silent when employees are looking for answers. People don’t expect guarantees, but they do expect honesty. Transparent communication, sharing both what is known and what remains uncertain, is the most effective way to manage layoff anxiety. When employees feel like they’re being left in the dark, speculation takes over, and confidence erodes.
Sandy Goel, founder of Go Well Advisory, emphasizes that leaders must be upfront about company realities. This means clearly stating priorities, explaining what decisions are being made, and giving employees a sense of control over what they can focus on. Even if no new information is available, reinforcing that leadership is committed to keeping everyone informed builds trust. Kevin Bussema, founder and lead consultant at The Collaborative Collective, reinforces this point, communication isn’t optional. Layoff anxiety thrives in silence, and leaders who avoid tough conversations only make the situation worse.
For executives, this highlights a fundamental reality, how a company communicates during difficult times defines its long-term credibility. Employees don’t forget how they were treated when uncertainty was at its peak. Leadership that is honest, direct, and engaged will come out stronger, and more importantly, will keep the talent that drives future success.
Main highlights
- Layoff anxiety is eroding workforce confidence: Widespread job cuts and corporate restructuring have made employees feel insecure, reducing engagement and innovation. Leaders should provide strategic clarity and visible career growth opportunities to retain top talent.
- Slow hiring is amplifying job insecurity: Despite low unemployment rates, hiring has stalled, making employees fear job loss with limited opportunities elsewhere. Executives should invest in internal mobility, upskilling, and clear retention strategies to maintain stability.
- Mental health struggles are hurting productivity: Rising stress and burnout among both employees and managers weaken decision-making and long-term performance. Organizations must implement real mental health support systems to maintain a resilient workforce.
- Strong leadership is critical in uncertain times: Managers who set boundaries, maintain transparency, and support their teams foster higher trust and engagement. Leadership development should prioritize structured communication and emotional intelligence to navigate uncertainty effectively.
- Clear and consistent communication reduces anxiety: Silence breeds uncertainty, while open, honest dialogue builds trust even during difficult decisions. Executives should establish proactive communication practices to ensure employees feel informed and valued.
