[castillar76]

Something I haven't seen in the comments here and I think is a significant factor is share price/company valuation (at least, for public/VC-owned companies). Executive management knows that any information shared with employees will absolutely be in the trades before the meeting is over. With that in mind, they can't just come out and say, "Well, our numbers aren't looking healthy right now and I'm concerned about the next quarter" because it results in 'FooCorp CEO "concerned about next quarter"' hitting the news. That both produces a short-term problem (it tanks the stock) but it also creates a potential self-fulfilling prophecy: you're concerned about next quarter's numbers, investors become concerned about next quarter's numbers, customers become concerned about next quarter's numbers, and now next quarter's numbers look even worse!

As a result, there's a strong incentive to keep your mouth shut about anything remotely negative until it's too late for it to affect anything significant, and then to release it in as positive-spin a manner as possible to minimize the effects. Hence, layoffs are spun as "restructuring to make the company leaner and focus our efforts". It's not that I think you can't be honest in presenting information like this to employees, but I do think we need to temper our expectations about the messaging from C-level execs, because Wall Street definitely does not reward radical honesty. (Maybe it should, but that's a whole different kettle of fish.)