INFLUENCE OF DOWNSIZING ON EMPLOYEES' ENGAGEMENT: EVIDENCE FROM THE NIGERIAN BANKING SECTOR

Abstract

In a bit to respond to regulatory pressures, economic volatility and transformation from the realm of technology within the banking system in Nigeria, downsizing has been sought as a recurring strategy. Even though the implementation of downsizing is aimed towards driving efficiency and ensuring reduction in costs, its intending consequences on the engagement of employees remains a principal concern in the human resource parlance. To this end, this study examined how downsizing influences the engagements of employees within the Nigerian banking system. The research was underpinned by the Social Exchange Theory and Psychological Contract Theory. The methodology centers on the adoption of quantitative research design where data were obtained using structured questionnaire that were administered to one hundred and twelve (112) employees of “Guaranty Trust Bank in Alimosho Area of Lagos State”. The result provided that downsizing significantly affects employees’ engagement in the in banking system. Similarly, high degree of association was discovered to exist between downsizing and employees’ engagement in the banking system. Through the findings, it was concluded that organisation should apply equity and fairness when embarking on downsizing in order to achieve employees’ engagement after the exercise. Equally, the management of the bank (GTB) and other organisation should provide information regarding the implementation of downsizing in order to give employees’ sense of belonging and bring about workforce engagement in the banking system.