5. What experiences effectively ended the loyalty and commitment-based contract that employees
had developed with employers?
Employers took steps to cut costs through workforce reduction as the demands for global
competitiveness increased.
Employers began to say that employees were not that valuable to the company’s success.
Employees’ desire for job security changed, and they no longer had a psychological need
for security.
Employers began to offer work-life balance perks to lure talented workers away from their
current employers, and loyalty suffered.
Employers felt that employees were not living up to the conditions of their psychological
contracts.
6. Which of the following terms is not commonly used to describe the elimination of employment
positions?
7. Which of the following is an example of external factors affecting the perception of a firm’s decision
to downsize?
The downsizing corporation does not offer any kind of career or employment assistance to
the employees that are being laid off.
A company begins assisting its employees who will be affected by the workforce
reduction as soon as it is aware of potential reductions.
Other companies in the area quickly hire the employees laid off from the downsizing
company.
The company considers how it will function after the workforce reduction has taken place.
External factors do not play a role in the perception of a company’s downsizing decision;
only internal factors are important.
8. Which of the following is not likely to be an effect of workforce reduction?
Employee compensation usually increases when fewer employees are working for a
company.
Job satisfaction and loyalty often decrease after a company experiences a workforce
reduction.
Former employees may begin receiving unemployment benefits.
Remaining employees begin to take on more responsibilities and workload.
Remaining employees are anxious about job security after they survive a round of layoffs.