The Effect of Retrenchment on the Moral of Workers and Productivity


Retrenchment according to the new standard dictionary is the cutting. down or reduction in extent or quality especially or things that here become or are becoming exclusive.  It is the dismissal of termination of workers when the job ceases to exist  usually of technology or economics change.  It is also can be seen on an act to cat down on expenses. 

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According to an editorial agency of retrenchments news watch vol 1 No. 2 (February 11 1985) retrenchment started of economy recession in the early through a recession but the Nigeria case has been a very peculiar situation because it has resulted in many workers losing their jobs.


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By the year 1960, school because second jobs with relative case, graduates were scare and had to come by and it was employers who looked for them instead of this other way round.  Thus, the economy of Nigeria was booming job existed if firms and government remained the greatest employer of labour.  However those were the days gone by.  Before this, period the colonial administration was interested and maintained dialogue with workers in terms of employment contracts and on working conditions.

The elite workforce from the public service maintain moderate working hours and fair income to the bargain and the Nigeria currency balanced by the British pound was reliability stable.  At this period also educational emancipation and the little technological advancement dictated the pace in relation between the worker and the employer, controlled considerably by the environment which was mostly on a result of retrenchment.


This is the attitude of workers or employee towards work which affects productivity.

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According to Hawkine (1910) in the book social study, he said that the fear of being turned off  is the worst thing in a working man; life talk of when one is being retrenched.  When a survey is being carried out in an organization which may revolve some processes that concern the effect within the organization, the exercise usually pose great effects on both productivity and on the moral or workers. Once some workers are being laid off in an organization, the retained workers tend to develop emotional feeling among their follow workers who were laid off.  They over- worked themselves because there are few people to execute the jobs.  This reduces the morale of worker and at times, they are not paid for their overtime.  This action tend also to develop fear on the retained workers since the work is full of uncertainty with the results there the slogan “who knows whose turn it would be tomorrow” reigned in the offices.

Morale of the workers is so important that no organization can afford to   ignore it. Fringe benefit is a way of satisfying employee needs and wants that are not satisfied by wages and then have considerable value in promoting employee’s morale productivity is linked with morale and its lacking could lead to poor productivity.



In this chapter, related literature were reviewed, the aim being to find one what authors or writers have done in similar issue in the past.

Motivation can be defined as a willingness to expend energy to achieve a goal or a reward.

According to Douglas Mcgregor, the traditional management view regarding people in a work organization is that the arrange workers has an inherent dislike of work, avoids responsibility lack ambitions and want it be closely directed.  Here, management is to exercise close control in order to get workers exert sufficient effort to attain organizational objectives.  According to Mcgregor, workers behavior in organization is geared toward the hands given to them.

According to system 4” management school of thoughts, they advocates that “people posses innate capacity for exercising initiative accepting responsibility and making meaningful combustion they do not indecently dislike work employees will actively work for the goals of the organization when such believes is comparable with their own goals”.

However, it has been assumed that a workforce that possesses high morale is also likely to exhibit high productivity.  It has seemed logical to managements that happy workers are also productive workers.  This condition did hold for the relay assembly test room in the pioneering Hawthorne experiment conducted by Elton Mayo and an Harvard associates in (1927 – 1929) in which he was a definite correlation between their increasing productivity and favorable attitude that the gives are towards one another, their supervisor and their environment.

On the Omahard Maclelland David (1961) points that people who scare high in achievement motivation on psychological test do not work harder for the prospect of making more money alone.  They are motivated by the interest in their work.  Love of accomplishment and success it self.

Rensis Likert (1961) was of the view that the relationship between morale and productivity tends to be moderately high, but situation in which moral in high but performance is poor can occur when a pleasure / social country atmosphere is enhanced as permitted of supervisor.

Herzberg holds that motivations seekers are motivated by the nature of the work itself, have a higher tolerance for poor hygiene factors, and show capacity to enjoy their work.


Vroom has asserted that employees who are intensive why attribute the causes of their satisfaction to there own achievement on the job while dissatisfaction on the factors on the work environments.

In (1974) moreover in this opinion about retrenchment exercise said that one of the criteria for selection of worker is efficiency or competence.  The concluded by saying that most of the retrenched were these know the job.




John Hrolt (1994) in trying is find out the causes recession claimed by many employees is not a cause of retrenchment.  At times workers will through collective bargain demand certain amount that is above what the employee could pay.  For instance when the new minimum wage was introduce by general Obansajo where federal workers are to be paid N7,000 and state workers N5,500 some workers under state government, said their should be paid N6,500. Such action can lead in order to compensate for their expenditure step taken by association union of universities (ASUU) recently in which they embarked on five month strike can contribute to retrenchment of there incoming lectures who supported the so called strike for demand of their minimum wage.

Oi (1962) was of the view that labour economist believed that firm tending to choose labour ‘hoarding’ that is toleration of a period of under employment as a preferred and less costly alternative to retirement and retrieving are different stages of the demand.  Cycle.  He support that a modern industrial economy labour has because a quasi-fished factor.  This was partly because of the cost of eventual replacement when the economic problems going rise to the redundant had been overcome. Nigerian economy are effected many as a result of the following factors:


(a)     Unskilled managers and engineers:-

This is one of the major reasons for retrenchment of workers in organization.  The employment of skilled manager and well to do engineers rather than acquiring it though God fathers can effectively be of good help to the country productivity in which case, the practicable methods or training can easily be applied rather than given of notes when they are not even familiar wills.


This also happened this year in Nigeria during 2003 election where incompetent aspirants were sworn in fort because of power of incubating.


(b)     Mismanagement

Organization a rather the country can achieve their goal through efficient use of resources available.  Retrenchment as being carried out as a result of this, economy are being mishandled by these unskilled employees who are there with the motion to make a quick cash, it doesn’t matter ; as a result of these, there is no equitable distribution of resources.



The shift from an Industrial to a port individual society and from nature economy to global bet working has change the nature of work in organization and accompanying the social expectation in service  sector firms around the world.  Older companies in particulars are  finding the traditional structures and members of operation ill – fitted to the new competitions unleashed from every corner, flexible response to unpredictable demand require rapid responses and the ability to act quickly and efficiently with the above emphasis, several factors were highlighted below as effect or impact of retrenchment of productivity.


(a)     Poor productivity

This is one of the major effects of retrenchment of various workers in various organization.  Rising productivity is the basis of economic growth.  Labour is only one of the faceable in the productivity equation.  As high productivity depends on the efficiency and effectiveness of the work performed.  In a situation where there is stagnation in productivity may be as a result of poor quality workforce, efficiency of work organization, lack of energy and incompetence of managers as well as bad altitude and behavior regarding work.

These can lead to laying off of inefficient workers for more competence quality workers for better productivity, which is the basis for the existence of any organization.


(b)     Large number of redundant workers

Redundant workers in various organizations have contributed in no small measure to the situation in question.  For instance the recent retrenchment exercise done by CHIMAROKE ADMINISTRATION Two years ago in Enugu State was mostly as a result of large redundant workers in various officers whereby there will be up to seven in one office barely doing nothing so, there exercise was carried out as reduce the number of redundant worker so as to compensate the retrained competent staffs.


(c)      Technology as enabler

This is one of the enabling factors that could lead to displacement of many workers, the real power of technology.  It creates compensate for their expenditures in paying new ways of working while new information technology application proved much greater feasibility in the approach to work for many qualified professional work, They also ring the neck for the unskilled untrained pr unwilling worker who fails to reap race with the constant rise in skills and competencies which they demand.  Such employees are rightfully apprehension of the initial intensification of work and changed working patters as well as the responsibility of external job lose that new technologies represent.  Lower tier workers who carry repetitive activities   like setting  for example, back office workers in-charge of change processing centers will be laid off as they are watching their current occupation disappears automated processes perform measure operations faultlessly and at greater speed than human can achieved

(d)     Poor health and bad records

This has also contributed to work retrenchment exercise being carried out.  Or is one of the criteria used to determine who is to be retrenched. A worker who is not physically fit cannot fit to the job operating heaving trick and other organizational equipments which aids to production of goods and services

(e)      Re – engineering of work

Organizational re-engineering has been called the fundamental thinking and radical redesign of business process to achieve dramatic improvement in critical, contemporary measure of performance, such as cost, quality, service and speed.  It focus is on the major business process or core activities of forms which add value to goods and services in the eyes of customers.  The process of re-engineering of work can lead to displacement of workers.  The problem say lie say not in the topic or the workers performing them but in the very structure of current reengineering task about organizations work processes, not merely improving, enhancing or modifying the present procedure.


Hawkins (1910) in his book social study reported that men grew inanity year older in five years through anxiety about less of work.  And again, Charles (1985) life and labour of the people in London in his statement “when I though it likely that I should be thrown out of employment, it seemed to paralyze me completely, I used to set at home breading over it until the slow fell.

A recent workers retrenchment done at the federal radio corporation were 35 workers out of 300 staffs were retrenched.  Then another one was cost year though it work servers like that of 1995 because only 5 workers was retrenched.

Socially, the recent retrenchment exercise brought untold suffering to most families.  Unemployment was loss income,  the children of the retrenched were thrown out of school as their parents were thrown out of jobs some of there children became socially mischievous.  Some of the retrenched youth themselves began to seek for other avenue of making livelihood.  Some even turn to robbers.


A recent research carried out in the federal radio corporation of Nigeria where staffs were queried concerning the effect within the organizations recent reductions in staffs.  About 76 percent of workers who responded acknowledge that the exercise has great effects on both productivity and on the workers morale.  Workers tried to develop emotional feeling among their fellow workers who were laid off.  They over worked themselves because there are few people to exercise the jobs.  This reduces the workers morale and at times they are not paid for overtime.  This exercise tends to develop fear

among retained workers since the work is full of uncertainly with the result that the slogan “who knows whose turn it would be tomorrow” reigned in the office


To place an order for the Complete Project Material, pay N4,000 to

Account No – 0044056891
Account No – 3066880122

Then text the name of the Project topic, email address and your names to 07033378184.  

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