Surviving Company Lay-offs: Here’s What to Do (and Not Do) Next
by Kaitlyn Ranze
Worst case scenario? You’re happily employed, enjoying your work, and then suddenly it happens – your company announces layoffs. It’s a gut-wrenching experience, not just for those who are directly affected but also for those who remain employed.
Unfortunately, layoffs have become increasingly common with the bear market in full swing (and possible recession looming). Not only that, but layoffs often come in waves. Once a company has experienced layoffs, they are more likely to happen again. In fact, research shows that layoffs beget more layoffs.
So why do layoffs happen? There are a few reasons.
First of all, layoffs are often used as a way to improve a company’s financial performance in the short term. This might be done in order to please shareholders or to make the company more attractive to potential buyers. However, this strategy is often not sustainable in the long term and can actually lead to further financial decline.
Secondly, layoffs can create a negative feedback loop within the company. As employees are laid off, morale decreases, and productivity decreases. This can then lead to more layoffs in an effort to further improve financial performance.
Finally, once a company has laid off employees, it becomes easier to do so again in the future. This is because there is less of a social stigma attached to layoffs and because the company has already established the necessary processes and infrastructure.
If you’re employed at a company that has recently experienced layoffs, it’s important to be aware of the risks. Try to stay positive and productive, and be prepared for the possibility that you may be laid off in the future.
If you’ve survived your company’s first round of layoffs, congratulations! Remember:
1. Don’t ignore your feelings. It’s natural to feel a range of emotions after surviving a layoff, from relief to guilt to anxiety about the future. Acknowledge how you’re feeling and give yourself time to process.
2. Don’t forget about your laid-off co-workers. They’re going through a tough time, too. Check-in with them and see how they’re doing.
3. Don’t neglect your finances. Even if you’ve kept your job, the layoff may have shaken up your financial situation. Review your budget and make sure you’re prepared for any unexpected expenses. Hello, emergency fund!
But there are some things you can do to prepare for the possibility of being laid off.
First, take a close look at your career plans. If you’re in a stable industry with good job prospects, then you may not need to worry too much about the possibility of being laid off. However, if you’re in a volatile industry or one with limited job prospects, then it’s important to have a Plan B in place.
Think about what you would do if you lost your job. Would you be able to find another job quickly?
Would you be able to survive on your savings for a while? What other sources of income do you have?
It’s also important to take a close look at your company. Are they experiencing financial difficulties? Just because you survived one round of layoffs doesn’t mean you’ll make it through another round. Remember, the chances of you being laid off are increased when your company has already had layoffs.
If you are worried about the possibility of being laid off, there are some things you can do to prepare financially.
First, make sure you have an emergency fund in place. This should be enough to cover your expenses for at least three months, though the average time between jobs has creeped up to nine months.
Second, make sure you’re not over-leveraged. This means having too much debt relative to your income. If you’re laid off, you’ll still need to make your debt payments, so it’s important to make sure you can afford them.
Third, consider taking out a life insurance policy. This can help ensure that your family is taken care of financially if you’re no longer around.
Finally, if the worst happens, keep in mind that being laid off doesn’t have to be the end of the world. It can be a chance to reassess your career and your life and make some changes for the better. If you’re prepared financially, then you’ll be in a much better position to weather the storm.