Layoff and Firm Long-Term Performance‪.‬

INTRODUCTION Downsizing is "the planned elimination of positions or jobs" (Cascio, 1993, p. 96). A key question in corporate restructuring is what role downsizing plays, and why firms' announcements are met with different stock price reactions. A downsizing action may signal organizational decline or may be part of an overall restructuring effort of management for future productivity and profitability improvements.