What to do When You Fear a Layoff
As of 2/1/23 Meta, Google and Amazon have already laid off or have announced plans to lay off 41,000 employees. What are things you can do if you think your job might be in jeopardy?
Look at increasing your cash emergency fund. Typically a two-income stream household should have three to four months of emergency cash on hand and a single-income stream household six to seven. Work on increasing your emergency fund to those amounts. If you already have that much, consider saving an additional couple of months’ worth as a buffer. A corollary to this is to look at your expenses and start paring back on your spending. Cutting out Starbucks, or at least reducing the number of trips, can add a decent amount to your savings account. Bringing your lunch to work is also an easy way to reduce your monthly outflow.
Be sure your emergency fund is in cash. Funds in a brokerage account or other investment can take a few days to conduct transactions in order to raise cash and transfer to your bank. Also, you may incur taxes or early distribution fees. Typically you will need quick access to your emergency fund. Cash in the bank is the quickest, easiest and most convenient way to fund unexpected needs.
It goes without saying, polish up your resume. Update your CV with any skills, certificates or job responsibilities you have gained. Be sure your LinkedIn profile exactly matches your resume. Hiring managers are going to look at your on-line resume for more details in addition to your resume. So make sure all the data on your LinkedIn profile matches your resume details. Keep both updated. Also, give your cover letter and references a refresher as well.
Dust off your address book. This is the time to begin reengaging with your network. Go through your contacts and reengage with those people who may have knowledge of potential openings or can point you to someone who might.
Consider exercising your options. If you have vested, but unexercised stock options consider exercising them. This will take some work to make an informed decision. You will need to balance the cost, and potential tax, of exercising your options with funding your emergency savings. You should also investigate how long after you get laid off you must exercise or forfeit your vested but unexercised options. Generally, most companies have a 90-day window from when you are laid off to when you must exercise. At the point you are laid off any unvested options are lost.
You’ve been laid off. Now what?
Negotiate your severance package. This may not be an option for everyone; however, give your old employer the opportunity to say yes. They can’t say yes if you don’t ask and if they say no you are no worse off than before.
Letter of recommendation. Ok, you got laid off but you still have valuable skills and experience. Ask your former boss for a letter of recommendation. This will help you land your next new gig.
What to find out. Make sure you know when is your last day. What happens to unused vacation/sick time? If you are paid by commission or you get a bonus, how are those impacted? Do you get your full commission for in progress deals? What are the options for your 401(k)? Ask for a letter from your HR department and find out about insurance benefits (COBRA) and final paycheck details.
Head to your local Unemployment Office. Unemployment Insurance is administered by each state separately. You can go online to find out what you need to bring with you and what information is required. Maybe you can even file for unemployment online. Even though it can take a few weeks for your claims to be processed you should not hesitate to file your claim. Even if you think you will not qualify for unemployment you should still file a claim. Give your State Unemployment office the chance to say yes.
Take some time. Be sure to breathe and relax. Being let go is a traumatic experience more so if it is unexpected. But this can be a time of reflection, perhaps this is an opportunity. Have you considered a career change or do you want to go back to school and finish your degree program? Whatever the case, don’t immediately push out a dozen resumes and hope some corporate recruiter will call you with a job offer.
Document your accomplishments. What are the things you have accomplished in your career? Time to pat yourself on the back. There are two methods you can use for this exercise. CARL (Context, Action, Result, Learning) or START (Situation, Task, Action, Result, Takeaway). Both methods help to you recognize your contribution and focus on the accomplishment and how you approached and succeeded in the challenge.1
Job searches are full-time jobs. Just like your previous workday had a defined start and end time, so too does your job search job. You must commit to a start time in the morning and an end time in the afternoon. This helps you to stay disciplined as you work to find that next opportunity. Create a schedule of what you will do and when you will do it. Then stick to that schedule.
Getting laid off is no fun and can be an extremely stressful and anxious period. With some careful forethought and planning coupled with a structured after-action plan, you can make this period less stressful and reduce potential anxiety. Remember when one door closes another opens....maybe just not right away. Have patience and perseverance in your search.
1 Credit to Harvard Business Review for these methods of review by Marlo Lyons 11/9/2022.