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By Stang Gappa
Updated on February 15, 2024
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A layoff can come as a shock to the system. But in today’s economic climate, layoffs are getting more prevalent.
Once the shock wears off, understand that you’re not alone. In fact, 40% of Americans report being laid off or terminated from a job at least once in their careers. In this guide, we’ll walk you through every step of the layoff process to help you not only bounce back, but also thrive, after a job loss.
A layoff is when a company terminates the employment of some of its workers. Layoffs are different from firings in that the employees usually aren’t at fault. Multiple employees are often let go simultaneously in a layoff.
There are a number of reasons companies opt for layoffs, including new initiatives, restructuring, or real or expected financial difficulties. Employees who are laid off may be eligible for certain benefits, such as severance pay and unemployment compensation.
If you work for a larger company, you may receive advance notice of an impending layoff due to a federal law called the WARN Act. Having a heads-up about a potential job loss can help you prepare your response if, unfortunately, you’re part of that layoff. While the actual notice may come as a shock, try to maintain your professionalism. Here are a few things you may consider saying:
Try to understand the reasons for the layoff and any details regarding the termination, including what the next steps are. Make sure you ask the following:
It may be tough to do in the moment, but asking for feedback on your performance at the company can help you prepare for your next job opportunity.
If you have a good relationship with your manager or colleagues, ask if they would be willing to provide a reference letter for your next job opportunity. It may not be at the forefront of your mind, but this step can give you a head start on securing your next job.
One of the biggest stressors in a layoff is financial uncertainty, so if your company is offering severance packages, ask to get the severance agreement in writing. This can be helpful in the rare event that you need to hire an employment attorney.
A layoff takes an emotional toll. Understand that those feelings are completely normal and warranted. One of the most important steps to take is to take care of your mental health and physical well-being.
Though a job loss may feel personal, keep in mind that the layoff was likely out of your control. Some people may go through the five stages of grief: denial, anger, bargaining, depression, and acceptance. Reach out to friends, family, a counselor, or a therapist if you feel like you need additional support. Additionally, take time to practice self-care. If you enjoy walks, meditating, exercising, or another hobby you love, make time for these activities while you search for a new job.
Research your health insurance coverage options. Start by finding out the date when your current health care plan coverage will end. Options for extending your coverage can include:
Your next step is to assess your financial health. Start by looking at your expenses and creating a budget that reflects your current situation.
Explore options that can help you avoid draining your savings, including unemployment compensation (also known as unemployment insurance), food assistance programs, and other community resources. If you received a severance package or payout for unused vacation days in your final paycheck, include those in your budget to help tide you over while you’re on the job hunt.
One of the most often overlooked aspects of personal finance during a job transition is retirement savings. As of May 2023, there were approximately 29.2 million left-behind or forgotten 401(k)s holding approximately $1.65 trillion in assets. While you may be tempted to withdraw from your 401(k), recognize that you may be subject to taxes and penalties that can impact your future retirement. Consider a 401(k) rollover to keep your retirement on track and stay in control of your assets. Find out about your options for exercising any stock options or equity you were granted, as well as the tax implications.
Don’t hesitate to reach out to a financial planner for advice. A professional can provide helpful insights on managing your finances during this transition.
When you’re ready to start job hunting, update your resume to include your most recent experience. Consider adding any skills, experience, and accomplishments from your most recent job so that they stand out as you search for new opportunities.
Take time to refresh your personal branding on social media. Update your LinkedIn profile to reflect your expertise and professional achievements. You may also want to revamp your website or portfolio to highlight recent projects that are relevant a new job. These steps will help you make a lasting impression in your job search.
Thankfully, a plethora of websites make job searching easier than ever. Start by looking at online job boards, like Indeed, LinkedIn, or Glassdoor, for potential opportunities in your field. Consider updating your employment status on LinkedIn to get the word out to your network that you’re open to job search support.
It’s also a great time to personally reach out to your professional network, including mentors, industry contacts, and former colleagues to ask about job leads or referral opportunities. You may also want to explore networking events or join industry-specific groups to grow your network and find additional opportunities.
A career coach or counselor can help you get an edge in your job search by providing expert guidance and clarity when you change jobs. They can even help you explore options for an entirely new career path if you’re interested in changing fields. A coach will usually start by evaluating your skills, values, interests, and goals to look at paths that may be a good fit. You can develop your skills and expertise through online courses and certifications.
Volunteering can be a valuable way to gain experience, expand your network, and give back to your community during a job search. Look for volunteer opportunities that align with your interests and skills, whether it’s mentoring others, supporting a cause you’re passionate about, or contributing your expertise to a nonprofit organization.
Perhaps the most important thing you can do after a job loss is maintain a positive mindset. Using your support system of family, friends, and mentors can fuel you with encouragement and perspective. Your employment status does not define you. Understand that it can take time to secure new opportunities.
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Which employees get laid off first varies from company to company, but it typically depends on factors like seniority, performance, and pay, as well as how these factors align with the company’s needs.
The process varies from company to company, but you’ll typically receive notice from your human resources team. You may be offered severance pay or other benefits. Many laid-off workers are eligible to collect unemployment insurance.
Finding a new job after a layoff can be challenging, but with perseverance and the right approach, you can land your next opportunity. Revamping your LinkedIn profile and reaching out to your network for job search support can be helpful when you’re seeking new opportunities.
It can take time for unemployment claims to be approved, so prioritize filing for unemployment as soon as you get laid off. According to the U.S. Department of Labor, it typically takes two to three weeks after filing for unemployment benefits before you receive your first check.
The average job hunting time after a layoff varies from person to person and depends on industry, location, and market conditions. But the average unemployment duration is 19.5 weeks or 5 months, according to the U.S. Bureau of Labor Statistics.
Remember, layoffs are common and not a reflection of your performance. A layoff can be an unexpected opportunity to realign your career so that it truly matches your wants and needs. Reach out to your support system, lean on your network, and keep moving forward. Your best is yet to come!
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