Global IT giants are spending billions to shrink their payrolls. From severance packages to outplacement support, layoffs have turned into some of the most expensive “cost-cutting” exercises in corporate history.
But experts say there’s a method to the madness, and it has everything to do with brand control, investor confidence, and the economics of AI-era restructuring.
Shruti Swaroop, founder of Embrace Consulting and co-founder of the International Inclusion Alliance, explained the strategy behind these lavish payouts.
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“Severance is a comparatively modest but conspicuous and upfront expense that mitigates legal exposure, defends employer brand and spirit, and accelerates transitions,” she said.
SHORT-TERM HIT FOR LONG-TERM BENEFIT
In other words, companies would rather take a financial hit now than drag out costs over time. “Short-term expenses to gain lower future payroll and an efficient cost structure might be the superior long-term economics,” explained Swaroop.
She added that the generosity isn’t rooted in empathy but in risk management.
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