How to Deal with Layoffs as a Setback Leader in 2025

Layoffs are not just a business event but a test of leadership character. And in times like these, only Setback Leaders rise above the noise with empathy, clarity, and courage.

From Silicon Valley to Wall Street, 2025 has seen another wave of mass layoffs. Companies are making tough calls, whether it’s cost restructuring, AI-driven automation, or investor pressure. However, how they walk their people through these defining moments separates a conventional leader from a setback leader.

The Conventional Leader’s Way: Silence, Spin, and Separation

Sadly, too many leaders still:

• Leave employees in the dark until the last minute.

• Use vague corporate speak to avoid accountability.

• Offer minimal support or none at all after separation.

These approaches hurt careers and shatter trust. They ripple through company culture, affecting even those who remain.

Setback Leaders Choose a Different Path

Setback Leaders operate on the SOAR framework: Sense, Own, Act, and Reinvent. They don’t avoid hard decisions, but they do lead with empathy, transparency, and responsibility.

Let’s look at a few inspiring examples:

1. Brian Chesky, Airbnb – The Benchmark in Human-Centric Layoffs

Even years later, Airbnb’s approach remains the gold standard. Chesky laid off 1,900 employees during the pandemic, but he did it with soul. His open letter explained the why, outlined the how, and focused on people-first actions like extended equity, healthcare coverage, job transition support, and allowing staff to keep their laptops.

2. Satya Nadella, Microsoft – Leading with Clarity and Care

In early 2024, Microsoft announced major layoffs affecting thousands. But instead of hiding behind PR filters, Nadella addressed employees directly, acknowledging the pain while outlining the strategy. What stood out was Microsoft's emphasis on:

• Personalized support for affected employees.

• Transparent communication from the top.

• Career transition help, including resume and interview prep through internal teams.

This wasn’t just a layoff; it was a leadership moment.

The SOAR Playbook for Layoffs

Here’s how you can lead layoffs through the lens of Setback Leadership:

1. SENSE the Human Cost

• Recognize the emotional and financial toll.

• Engage your leadership team in conversations about compassion, not just compliance.

2. OWN the Decision Authentically

• Be direct and human. Avoid jargon and sugar-coating.

• Acknowledge your own discomfort authentically. No crocodile tears, please.

3. ACT with Integrity and Support

• Provide mental health resources and career support.

• Offer LinkedIn recommendations and severance packages, and connect employees with recruiters.

4. REINVENT the Narrative

• Use this as an opportunity to realign the organization with purpose.

• Encourage departing employees to see this moment as a redirection, not a rejection.

Layoffs Don't Define You. Your Leadership Does.

At its core, Setback Leadership is about transforming challenges into a leadership edge. Every layoff, every disruption is a choice point: retreat or reinvent?

If you're facing tough decisions, ask yourself: Am I managing this as a task, or leading this as a transformation?

Have you recently led your team through a layoff? How did you approach it? Share your story. It may help someone else lead with heart.

👉 Ready to turn setbacks into leadership strength? Bring the Setback Leadership keynote or SOAR workshop to your organization.

Visit www.srijata.com or email me at connect@srijatabhatnagar.com.