Study On The Domestic Corporate Layoffs Based On The Background Of The Financial Crisis

Since 2008, the economy of many countries in the world has been damaged to different degrees by the global financial crisis caused by the U.S. Subprime Mortgage Crisis. Many world famous enterprises which have been affected by the depression take measures to protect themselves in the face of the serious financial crisis and the best policy is downsizing. China has established a more and more close relationship with the world economy since its accession to the WTO, so China's economy would not spare the downturn. The global financial crisis caused by the the U.S. Subprime Mortgage Crisis has affected China's real economy. Since the second half of 2008, China's economy has been undergoing more and more prominent difficulties. Many companies face the challenge of downsizing. If handled well, it can change the danger and difficulties into opportunities for enterprises to survive and provide a better platform for their development. If not, the situation would go from bad to worse, even bankruptcy.However, many companies just take the short-term interests into consideration, ignorant of the long-term negative effects caused by the layoffs. Without careful analysis and consideration of redundancy, it would bring corporations an adverse impact on the long-term development, therefore, how to conduct layoffs and select rational downsizing mode is very worthy of attention and study of practical issue. Blind cuts and layoffs after careful analysis and long-term consideration will lead to different results although human resources are well-reallocated and properly used. So how to improve the effectiveness of downsizing is worth in-depth study. The efficiency of downsizing bears a close relationship with the downsizing process. In this article, issues in terms of layoffs under the situation of financial crisis will be analyzed and how to make the downsizing activities more effective will be discussed, firstly, the financial crisis and the background of domestic corporations downsizing, followed by the review of the theory of layoffs at home and abroad with the purpose of having a clear understanding of theoretical basis of this study; then, in the light of the financial crisis, analyzing the reasons for layoffs of the domestic corporations; next, analyzing the benefits and harms and weighing up the pros and cons. In the end, some suggestions and strategies for domestic corporations downsizing will be discussed in the light of some successful examples at home and abroad.