The reality of priortising profit over people: An HR perspective

To the beat of a drum, organisations are moving away from long-term to short-term planning. 

It’s called short-termism. 

And organisations are thinking and investing in people with a short-term lens. 

If you work for a public company, you’ll know this. Quarterly results seem to outweigh almost everything else. It affects how HR makes decisions and develops its hiring strategies. This happens most notably in the form of mass redundancies, which never existed before the 1980s. 

That’s right. It’s a relatively new phenomenon where organisations have normalised cutting off the livelihood of employees because they’re not as profitable at the end of the quarter as they’d like to be. It’s not that they’re sinking, it’s just that they’re not hitting their projected, arbitrary target. 

Which is why HR needs to shift its focus from equity to employees.

In this blog, we’ll explore the reality of prioritising profit over people, the impact of layoffs on Gen Z and what HR can do to build more sustainable, people-centric strategies.

Impact on Gen Z
Behind millennials, Gen Z is the second most employed demographic in Australia. So organisations need to understand that the 24-year-old Gen Z employee has grown up in a time where mass redundancies have become normalised. 

Nearly 100% of Gen Z employees either have a parent or a friend's parent who was laid off through no fault of their own. Instead, they were laid off because a department didn’t hit an arbitrary projection.

An employee's work input, loyalty, and productivity, things that should be valued in organisations aren’t anymore. This means it’s not based on meritocracy—it doesn't matter how hard they worked, or how well they worked, or how long they’ve worked there. If an organisation misses arbitrary projections, employees lose their jobs. 

And so the thought of Gen Z devoting their entire career to one company is hilarious to them. But that's not because they're entitled or stupid, but because they’re playing by the rules. 

Back in the day, employees would work and ask their boss for a raise. These days, Gen Z wants to be paid upfront. And they're right because they're hedging their bets. They don't know what day they're going to get laid off—so at least give me the cash now!

Cultural acceptance of redundancies
Before the 1980s, the concept of mass redundancies on an annual basis to balance the numbers didn't exist. 

Now it's culturally acceptable. So much so that if an organisation announces mass redundancies, its stock price goes up, and if it announces a significant investment in research or non-revenue generating means, its stock price goes down. 

In other words, when decision-makers focus solely on short-term equity gains, they sacrifice the long-term trust and stability of their workforce. So if your organisation and the people who make decisions base it on the price of their equity, guess what happens? 

The normalisation of layoffs as a regular business strategy has profound impacts on employee trust and corporate culture. When organisations quickly turn to layoffs to balance books, they inadvertently send a message to employees that they’re expendable. This erodes the very foundation of trust and loyalty that organisations need to thrive.

HR plays a pivotal role in challenging this norm by exploring alternative cost-saving measures and advocating for strategies that protect employee interests. By promoting a culture that values employee retention and considers redundancies as a last resort, HR can help rebuild trust and foster a more committed workforce. Addressing this issue aligns with ethical business practices and enhances the organisation's reputation both internally and in the broader market.

Leadership by example
Organisations can't simply tell employees they have an open-door policy. It doesn't work that way. Leaders have to show it by implementing it upfront. 

Effective leadership becomes even more important when work environments are changing. This is especially true in challenging times when decisions like returning to the office are on the table. Anxiety and hesitation come from organisations making decisions like this. 

So to combat this, mandating that only senior leaders return initially eases the rest of the staff into the change. This approach not only shows leadership's commitment to collective well-being but also builds trust, making employees feel safe to voice concerns and ask for the help they might need. This method fosters a culture where employees feel valued and supported, ultimately enhancing productivity and satisfaction.

This level of transparent, empathetic communication can transform the workplace, turning challenges into opportunities for genuine connection and mutual support.

Conclusion 

In a world where profit margins rule supreme, it’s easy to lose sight of what truly drives success in an organisation. 

HR has to change the rules. We have to make employees feel like we’re investing in their growth. We need to build trust even in uncomfortable situations so they understand we’re not going to cheat them. We have to make employees feel like we're investing in their growth because when profit is prioritised over people, Gen Z quickly learns that loyalty comes at a cost. 

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Martian Logic has been empowering HR teams with simple, scalable solutions that help organisations thrive. Our intuitive HRIS streamlines every aspect of HR—from recruitment and onboarding to managing internal mobility and compliance. By automating administrative tasks and providing real-time insights, our platform enables you to focus on what truly matters: investing in your people. Ready to transform your HR strategy and build a more sustainable, people-centric workforce? Contact us today and discover how Martian Logic can boost engagement, retention, and long-term success.