How does downsizing impact employee morale according to the provided context?

Downsizing often creates an atmosphere of uncertainty and anxiety among employees who remain with the organization. When job cuts occur, the remaining staff may feel a sense of vulnerability, worrying about their own job security and the future of the company. This feeling can lead to decreased morale as employees grapple with the emotional fallout of seeing their colleagues let go and wondering if they may be next. Furthermore, the sudden reduction in workforce can overwhelm those who remain, as they may be required to take on additional responsibilities or cover tasks previously handled by others. As a result, feelings of demotivation can emerge, undermining productivity and engagement. Thus, the impact of downsizing can create a challenging work environment where morale is negatively affected.