'Forever layoffs' and disengagement for some, pay bumps for others: What's in store for the 2026 workplace, says new report

Glassdoor's latest report reveals a significant shift in layoff trends, with smaller-scale firings (under 50 people) now comprising 51% of WARN Act notices in 2025, up from 38% in 2015. This 'forever layoff' strategy is fostering widespread employee anxiety and resentment, negatively impacting company culture and leadership sentiment, particularly in media, consulting, and technology sectors due to factors like AI disruption. Conversely, the report highlights an encouraging trend of rising wage growth for young workers with up to four years of experience, promising increased spending power in 2026, despite a challenging entry-level job market.

Analysis

Glassdoor's latest report indicates a significant shift in layoff dynamics, with smaller-scale firings (under 50 people) now constituting 51% of WARN Act notices in 2025, a notable increase from 38% in 2015. This 'forever layoff' strategy, while potentially keeping companies out of headlines, is fostering widespread employee anxiety and resentment. Previous research shows negative employee sentiment takes over two years to recover post-layoff, with repeated cuts doubling this impact.

The report highlights a decline in Glassdoor ratings for senior leaders since H2 2023, particularly in media, communication, management, consulting, and technology sectors. This erosion of confidence is attributed to AI business disruptions, media consolidations, and a resurgence of 'hustle culture' ideals. Employee reviews increasingly mention 'misalignment, distrust, and hypocrisy' regarding senior leadership, signaling deteriorating internal corporate fundamentals.

Despite the challenging corporate environment, there is a silver lining for young job-seekers. Wage growth for workers with up to four years of experience is on an upward trajectory for 2026, enhancing their spending power. While entry-level roles have been scarce due to AI adoption, those securing positions are commanding better pay, particularly in rising cities like Provo, UT, and Austin, TX.

Key Decisions for Investors

• Scrutinize human capital management and employee sentiment metrics for companies, especially in technology, media, and consulting, as persistent layoffs and declining leadership trust may indicate long-term operational and ESG risks.
• Assess the potential for increased consumer spending from rising wages among young workers, particularly in identified growth cities, which could benefit regional consumer discretionary and real estate sectors.
• Factor in the broader economic implications of a bifurcated labor market, where corporate efficiency gains via AI and 'forever layoffs' coexist with targeted wage growth, influencing overall demand and talent acquisition strategies.