JXAH

Though an organisation benefits in the short term from lower operating costs, in the long run layoffs adversely affect the image of the company. It also creates an atmosphere of uncertainty as the employees are worried that they will be affected next. This reduces their productivity and  employee morale.

Over a period of time, a layoff affects the ability of the company to attract suitable candidates, who may be needed for future growth as economic conditions improve. This is the reason why some companies have a tradition of not laying off any employee.