Are 'quiet redundancies' happening in your workplace?

RTÉ News​

2 days ago

Analysis: Employers in Ireland are implementing 'quiet redundancies' to scale back workforces in the face of uncertainty, tariffs and AI
You've heard of revenge quitting, quiet quitting, coffee badging and micro-retirement, but what about 'quiet redundancies'? According to a recent report from consultants Morgan McKinley, there's been a 'subtle shift' in how workplaces in Ireland are strategising and planning around hiring, in order to scale back their headcount in the face of uncertainty.
"One emerging trend this quarter is the prevalence of ' quiet redundancies '—non-renewals, scaled-back team structures and discreet workforce adjustments that are not immediately visible in headline figures," the report noted.
But what exactly are quiet redundancies and how do they show up? "If you use the American phrase it's 'quiet firing' or 'stealth layoffs'," says Trayc Keevans, Global Foreign Direct Investment Director at Morgan McKinley in Dublin. "It's a situation where a company will reduce its workforce, but it won't do it through the official redundancy means, and they won't do it in the volume that would require a public announcement. So there's a lot of ways in which it can be done, and this is where it becomes a little bit complicated."
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Quiet redundancies can involve, for example, roles being re-drawn or phased out, or the non-renewal of contracts. "Somebody who would have been on a contract, the work is still there but that contract wouldn't be renewed and that work would be allocated to, maybe, permanent team members," says Keevans. "There could be a situation where people might have a lack of support and resources and may leave of their own volition. There may be incentives for people to retire early. In some extreme cases, maybe exclusion from certain projects that would lead to discontent and people may be leaving of their own volition."
"There's a lot of cases where we have had talent speaking to us about the fact that somebody in their team has gone on maternity leave, for example, and they're not getting the replacement for them. So that work has been allocated across a number of persons, where before there would have been a contract cover for that person," she says. "We are seeing a workforce that, yes it's been streamlined, but the workforce that's in place now, a lot of them are creaking at the seams, in terms of they're doing a lot more with less resources."
How was the trend identified?
Morgan McKinley produces a quarterly employment monitor that measures and compares two things: the number of professionals that are on the market at that time, and the percentage difference quarter on quarter, and year on year, as well as the percentage of professional job opportunities in the market.
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"Quarter on quarter it wasn't telling us a lot," says Keevans. "But when we looked year on year it showed us that there was 16% more professionals on the employment market looking at opportunities, versus only a 2% increase in corresponding jobs. So the rate of professionals looking for jobs was increasing faster than the number of jobs being created, and that wasn't necessarily being reflected in the unemployment rate, which was largely holding its own around [3.9% to 4.2%] year on year."
What's driving the trend?
Previously, when someone handed in their notice, by and large the role was being replaced, says Keevans. "The only difference might be, would there be a different profile of person required from a soft skills point of view? Was there anything that had changed in terms of the role itself that required a think-through? That was maybe as complex as it got." But from the beginning of last year the pace of hiring slowed down and "there was a much more cautious and considered approach" to hiring, she says.
So instead of a role being immediately or directly replaced, "a person would hand in their notice and then the organisation would have a discussion around, are the skills that were within that position still required within the organisation? Or does the organisation require a different set of skills, a different profile of hire to go forward? And very often what you had was a completely different position from what the person who handed in their notice would be - and that slows down the pace of hiring."
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This was in part a consequence of a lot of over-hiring in the Covid years. "There was a need to maybe look at right-sizing their organisation," says Keevans. "There was more consideration, more stakeholders involved in that decision, there was caution around budgets, and was this an absolute necessary hire?"
In parallel, AI is an inescapable part of the conversation. It's difficult to quantify the impact that AI is having at this point, Keevans says, but elements of jobs and processes are being automated, with the result that a role might not be completely replaced [by AI] but it might "involve a reallocation of the responsibilities of a role, where some can be automated across a number of employees. With the result of that work forces were reducing in size."
"Cost saving was obviously one part of it but also there was a sense that companies didn't want the negative publicity that a redundancy situation would typically give to its employer brand," she says. "Because in parallel with this streamlining of headcount there was also a need to hire new emerging skills that were critical for the business to successfully move forward and continue to be successful in its given environment."
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The report noted that while it's too early to pinpoint the exact drivers behind the trend, "the combination of global economic uncertainty, AI-led transformation and anticipation around US tariffs suggests companies are shifting from reactive hiring to more cautious, long-term workforce planning."
US tariffs and the growing role of AI are often cited as sources of uncertainty for the employment market, says Professor Kevin Murphy from the University of Limerick. "Both of these signal employers' inability or unwillingness to make lang-term investments across the board, including investments in the workforce."
Tariffs, which have become a significant factor thanks to US president Donald Trump, are a source of "particular instability" because of "near-constant changes in the scope of proposed tariffs", says Murphy. "Depending on the day, US tariffs on exports from the EU might be 10%, 20% or 50%, with no guarantee that they won't change fundamentally the next day."
Unlike many workforce adjustments in the past, Murphy says the current pattern of uncertainty is hitting skilled workers in knowledge-dependent jobs more heavily. "Managers and professionals have often been insulated from changes in the job market, but the continuing development of technology that can replace some of the services they have traditionally provided is making job markets for skilled knowledge workers particularly unstable."
The moves in reaction to the current global economic climate have been more than six months in play, says Keevans. Global supply chain and procurement operations are, in some cases, being retrenched back to the US for some US-headquartered businesses "and that's largely to do with taxes, tax structures and agreements that can be in place."
The tariffs add an additional burden and layer to operating in Ireland, with the result that "there's probably more senior procurement talent coming on to the market than we've seen in years, because they've been highly sought after by a lot of the US multinationals setting up here," she says.
Is the 'quiet redundancies' trend going to continue?
"It's hard to tell. What I would say is that hiring has become more unpredictable than I think it has ever been," says Keevans. "While Ireland is still very reliant on the US for Foreign Direct Investment, disproportionate to other locations, I do think there's really good work being done by IDA to repurpose that a little bit and safeguard future investments. I've seen a lot of investments opportunities coming from other international locations which would bode very positively for future hiring here in Ireland."
"One of the things that's really apparent is hiring will take more of a skills-based approach, maybe than it ever has before," she says. "So there's huge opportunities for employees to really consider the role that they're doing, and saying, where are the gaps versus how the market is moving?"
There has been is an increase in internal mobility and that's back to organisations upskilling and reskilling their existing workers
"There's a lot of work being done on organisational structures throughout the country - is it fit for purpose? Is it fit for where markets are going, to insulate against any risks that they may have both locally and internationally? Skills will form a big part of that."
"LinkedIn has released regular data on the speed of hiring and the volume of hiring, and what they can see is that there's been reduction in speed of hiring in a number of countries, Ireland included, year on year. But what there has been is an increase in internal mobility and that's back to the focus that organisations have of upskilling and reskilling their existing workforce, understanding better what are the skills that they have within their organisation."