A Study on Socio-economic Impact of Retrenchment on Workers—with Special Reference to Allahabad

Abstract

The present study aims to discover the social–economic impact of an unanticipated and involuntary loss of employment retrenchment of workers, evaluating the efficacy of the law in this regard and tries to assess as to how persons who have lost their employment owing to retrenchment cope with the situation. The results or consequences of job loss have been studied by a number of psychologists and social sciences researchers. Their findings have shown that retrenchment has traumatic effects on a person’s life and his or her family. Even the employees who manage to survive, the company, the organization and the whole society experience the ill-effects of retrenchment. The situation in case of retrenchment is impetuous and unalterable. Employees who experience involuntary retrenchment react more negatively to unemployment and are more likely to perceive retrenchment as a one-sided breach of psychological contract with the organization. Some authors have coined the phrase ‘chain of adversity’ to express the downward spiral of misfortune that some workers experience after retrenchment. The psychology literature describes the event (shock of job loss due to retrenchment) as ‘illness’ and the change in personal and career front it initiates as ‘recovery’ from the ‘illness’.

Can Downsizing Correlate with Community Development? A Complex Adaptive Systems Approach

“…In line with this, relevant stakeholders must be permitted to make meaningful contributions to these retrenchment programs. It is also important to note that there is a close-knit interconnectedness between organisational effectiveness and profitability, employee dignity and socio-economic development such that retrenchment programs should always factor that in their design (Classen & Dunn 2012;Chandra, 2014). This also calls for researchers to look beyond the impact of downsizing on organisational effectiveness and focus on the implications of retrenchment on the wider society and humanity at large.…”

Analysing trends and patterns in retrenchment research: a bibliometric approach

“…Similarly, retrenchment causes financial hardship for both retrenched employees and their families, resulting in stress, broken relationships, and a lower quality of life. The emotional toll extends to family members, causing anxiety and uncertainty and necessitating lifestyle changes that may impair access to critical resources such as education and healthcare (Chandra, 2014;Chandra, 2010;Kurebwa, 2011;Gribble, 2009;Weller 2007, McCourt, 2001. Furthermore, individuals frequently face career setbacks, such as difficulties obtaining new employment, retraining requirements, and potential effects on long-term career prospects and self-esteem.…”

“…Retrenchment can also have serious economic effects for society, such as reduced consumer spending, lower tax revenues, and increased dependency on government assistance (Ekanem & Umemezia, 2018;Ogbechie, 2015;Chandra, 2014). It can also contribute to social discontent, political instability, and long-term consequences such as diminished trust in employers, restricted job mobility, and economic inequality.…”