Look out for these five signs that a layoff is around the corner — and then decide what you'll do about it.
Unfortunately, layoffs are a part of life for some companies and individuals. If you've never been laid off, you probably know someone who has. According to outplacement consultancy, Challenger Gray & Christmas, job cuts announced by U.S. employers jumped 106 percent from December 2019 to January 2020. Companies are restructuring all the time and the economy is constantly shifting, which means layoffs will continue to impact employees across every industry.
No one has a crystal ball that can warn them when a layoff is coming, but there are some telltale signs of an impending reduction in force. The following five scenarios are some common examples of slight changes that could indicate an impending layoff.
You can hear a pin drop
When an organization is considering whether a layoff is necessary, often management knows before everyone else. If job cuts are looming on the horizon, you may notice managers and HR spending more time behind closed doors, the quarterly town hall meeting might get canceled, upper management starts to quit, or your manager may communicate less than normal. If you sense that somehow things don't seem the same, your sixth sense may be trying to tell you something about your future at the company.
The company just announced big losses
Disappointing business results are a strong indicator that organizational changes are coming. Lower-than-expected revenue or the failure of an important business unit will often trigger a layoff in companies as they look for ways to balance expenses with falling revenue. If your company is not performing well, chances are getting laid off or fired is on the table as a possible fix.
Some roles are redundant
Many companies often have more than one employee who performs the same function. There is often plenty of work to go around, and companies benefit from having a backup for important roles in the event of a resignation or employee absence. However, if you start to notice there's a bit too much support, you can bet management has noticed it as well. If you have five staff accountants in your unit, but new technology or more efficient processes make it possible for three accountants to get the work done, layoffs may be around the corner.
Related: Ask Amanda: How Can I Bounce Back After Getting Laid Off?
A merger or acquisition is coming
Layoffs are often a natural outcome of merger and acquisition activity. When two companies come together, there may be overlap in some areas, leading to the decision to eliminate positions. Not every merger leads to layoffs, and in some cases, companies add new jobs when they merge. But just in case, if your company announces a potential merger or acquisition, ask questions and try to understand how it could impact your job.
Company spending and hiring slows
One of the signs that job cuts may be on the way is reduced corporate spending. If you're suddenly told to hold off on a project that requires an investment in new technology to get it off the ground, or that there's a freeze of all “non-essential” company travel, trouble could be coming.
Has the company put a moratorium on hiring? Do you no longer have the green light to hire that new marketing designer that was in the roadmap? If extra thrift is the order of the day, then ask around and see what the cause could be. If no one seems to know, a corporate reorganization with layoffs could be the company's answer.
Cyclical unemployment poses a threat
In times of slow economic growth and economic turndown, layoffs might not be in your company's control. Instead, the natural ebb and flow of the economy is to blame, causing a period of mass layoffs with little hiring. The key to surviving this type of layoff is to formulate a plan in which you can stay afloat until the job market improves. Consider freelance or consultant work or even pursuing a second job to earn extra cash in the interim. These days, in the age of remote work and the gig economy, there are numerous ways to make money outside of your 9-to-5.
How to prepare for the layoff
Being laid off can be scary, but it can also be the time to relaunch your career. To be fully prepared for whatever lies ahead, there are some specific steps you can take to make sure you're in the best possible position to bounce back from a layoff. For example:
Start your job search
Sometimes it's better to jump ship before you're pushed into the water. If you have a strong sense that your company may begin eliminating certain positions, then update your resume, get in touch with your network, and begin exploring new job opportunities.
Build your skills
If you think you could be affected by a layoff, focus on expanding your skill set with training, continuing education courses, or a new certification. If you suddenly find yourself in the job market, those new skills will come in handy.
You may see a layoff coming and decide to do nothing. If you're considering retiring, you might not be too worried about being laid off. Or maybe you know your company traditionally offers generous severance packages, and you'd like to stick around to get one. Whatever your reason, you may be among the few who aren't all that worried about being laid off.
Sometimes the writing is on the wall and layoffs appear to be inevitable. Other times, there are only signs of an impending layoff, with little clarity about its impact on your job. No one has all the answers, but if you read the signs and prepare yourself, you can survive and move on after a layoff.
Worried about a layoff and want to make sure your resume is ready for a new job search? Let us help with a free resume critique!