This question is great to ask during a job interview with a company that recently laid of people. Stories about layoffs are often distributed in local media or by word of mouth. Talk to your friends about the company before the interview as a part of your information gathering. If you find out that the employer recently laid people off, you can ask this question to find out why.
Showcase Your Business Acumen: The question is not “Why did you lay off people?”. You are not questioning their integrity or feeding rumor mills. You are not voicing the potential negative feedback you got from friends employed with the company. You are simply asking an open question where you are already assuming that they had business reasons for their actions. This showcases your business acumen.
Understand Business Reasons: Perhaps media reports were more focused on the tragedies of employees that no longer have a work space. Often media and the rest of us forget that at least the people who are still working there, got to keep their jobs. Companies generally do not lay people off without financial reasons. If they were to continue operating along the same path, there would have been more layoffs and perhaps even bankruptcy.
Evaluate Employer’s Fire-Hire Mentality: Of course not all companies operate within the highest ethical standards. This question aims to make sure that they are not one of the bad ones. Listen to how they explain their recent decisions. Does it feel like this decision was justified? Ask follow up questions to find out how often they perform such layoffs. How do they work on developing staff to tackle new tasks and once again contribute? Do not ask the question directly, but you want to find out if this is common business practice. Is the company poised to grow organically or is it a consistent pattern to hire too many during good times to then only have to fire at the first sign of problems.
All Company Information Questions at the Interview