Corporate Downsizing The U.S. economy was at the height of economic expansion, stocks were near all time highs, corporate profits were strong, and the unemployment rate was at its lowest in two decades. At the same time, the major corporations in the United States were firing workers by the hundreds of thousands, and job insecurity had risen to an extremely high level. What was also ironic was the fact that the corporations who were …
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showed last 75 words of 787 total
…occurs. The authors were able to conclude that downsizing does change the stock prices to some extent in certain cases and in other cases to a large extent. Even though this test involved only two companies- Delta and United Airlines- we have sufficient evidence to affirmatively draw the conclusion that, yes, when used as a medium to determine a company's efficiency, the company's decision to downsize does have a positive effect on its stock prices.