Layoff announcements don't just affect those being shown out the door; employees who remain are often stressed, anxious, unproductive and, ultimately, disloyal.
Revenues are slumping, costs need to be cut and layoffs are an easy way of doing this. Many bankers will have accepted that cuts are necessary, but are not particularly happy with the way they've been implemented.
At UBS, for instance, employees would have been fretting over the falling axe months before today's layoff announcement, and it was rumored that staff in Bank of America's Irish business found out about looming cuts from concerned family members in the U.S. before the subject was broached by the firm.
In such periods of uncertainty, financial services workers are likely to be less likely to help out their fellow colleagues (as they might take the credit), be more reluctant to take risks (for fear of failure), be unduly submissive to managers and generally less productive, suggest business psychologists.
"If employees know cuts are coming, every meeting or glance towards their desk by senior managers is viewed with anxiety or paranoia," says Dr. Rob Yeung, corporate psychologist and director at consulting firm Talentspace. "Even after the cuts have been implemented, some people get 'survivor syndrome' - why have they been spared when colleagues they respected were let go - and often this leads to feelings of discontentment."
There's also the fact, as Reuters pointed out, that that when banks cut staff, workload increases, customer service suffers and hours are inevitably longer.
If layoffs are coming, it's important not to focus on the things you can't control (the cuts will happen, regardless of whether you fret about it), and embrace the things you can.
Here are some financial services career coaches' and business psychologist tips:
1) Don't necessarily look to the safe havens
Once your company rolls out layoffs, it's difficult not to think these could be the first round of many, particularly - as many investment banking cuts have been - they're a relatively small proportion of total headcount.
The likes of Jefferies and RBC Capital Markets, which have maintained a bullish expansionary message even recently, have lured bankers from UBS, JP Morgan and other bulge bracket banks in recent months. Sticking around, however, could ultimately benefit your career.
"Banks are savvy about the need to keep employees motivated during times of upheaval, and often focus on the training and development of staff members they wish to keep," says Katherine Timmins, client director at business psychologists Nicholson McBride. "They also need to openly communicate the logic of any cuts to employees, to maintain trust and avoid gossip or speculation of further redundancies."
2) Butter up the right people
"People think that it's just a case of impressing your direct boss, so they understand and communicate your value to the senior ranks," says Linda Jackson, managing director of the City practice at career coaches Fairplace. "Really it's a case of networking across the organisation to ensure as many of the right people as possible speak up for you."
3) Act as though you need to find a job
"If you're working a 14-hour day, it's difficult to prepare for you next career move," says Yeung. "It's safer to assume the worst could happen - get in touch with friends and contacts about potential opportunities, update your resume, talk to recruiters and generally get a picture of the market. Psychologically, it's better to know you're prepared for the next move."
4) Help others out
In a tight job market, sounding out your contacts about any potential opportunities can sometimes smack of desperation and could even count against you.
"Politicking is important during times of turbulence, but it's not always beneficial to just start tapping up you friends and ex-colleagues," says Jackson. "Frame it differently - how can you help them? Inadvertently, this could open some doors for you."
This article first appeared on our UK site