Asian economic crisis : retrenchment and companies' financial performance

Abstract

Our research sets out to examine whether a change in the number of employees is a significant factor in determining the financial performance of Asian companies during the Asian Economic Crisis. Our findings indicate that changes in the number of employees have insignificant influence on the companies' financial performance. Since reducing the number of employees may not necessarily lead to higher profits, management should seriously consider all the organisational costs of retrenchment before they contemplate retrenchment.