A survey found that 50% of employers expect to lay off workers. Here’s how to prepare
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Several companies have announced layoffs in recent weeks, and others have hinted that cuts may be imminent. Fortunately, there are steps workers can take to prepare.
“At the end of the day, you can’t control what happens in the economy, but you can control to build strong career resilience,” according to Mandy Woodruff Santos, career and money coach.
Best Buy, Ford Motor, HBO Max, Peloton, Shopify, Re/Max, Walmart and Wayfair are among the companies that have announced layoffs in recent weeks.
Meanwhile, 50% of companies expect a reduction in overall headcount, while 52% expect hiring freezes and 44% canceling job offers, according to a survey by PwC of 722 US CEOs sent in early August.
These are CEOs’ expectations for the next six months to a year, and so may evolve, according to Bhushan Sethi, co-chair of PwC’s global group of people and organizations.
“They focus on what they can control,” Sethi said of employers. “They’re dealing with geopolitics, supply chain issues, inflation, the war in Ukraine, all these factors that they have to define their strategies on.”
Despite these negative indicators, other data indicates that the labor market remains strong.
Employers added 528,000 payrolls in July, beating expectations and announcing a full recovery of jobs lost during the Covid-19 pandemic. The layoffs rate hovered near record lows in June, while job opportunities remained historically high.
About 250,000 people filed an initial claim for unemployment benefits during the week ending August 13 – an increase compared to the spring but only a slight increase from pre-pandemic levels.
“Labour markets are still incredibly strong, judging by all the data we’ve seen,” Sethi said.
Here are some tips for preparing for a possible layoff.
Evaluate your “personal professional economy”
Workers must first assess their specific situation, rather than extrapolate based on negative headlines. Experts said your industry may be well insulated from layoffs, at least for the time being, which means the concern may be misplaced.
Woodruff-Santos recommends thinking instead about your “personal professional economy,” including your job and skills. For example, what do the job opportunities and positions in your field look like? What do you see and hear from people in your field?
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“People should forget what happens in Silicon Valley if they don’t work in this space,” she said. “If you’re a project manager in education or healthcare, that’s a whole different ball game.”
It remains a market for workers in many areas of the economy, Sethi said, especially for talent specializing in areas such as cyber and digital security, automation, supply chains, and mergers and acquisitions, for example.
Evaluate your money
It’s always wise to have an emergency fund, but this financial reserve will be especially important after a layoff.
These funds will help close the income gap during periods of unemployment. Many workers do not receive severance payments or may only receive an income for a few weeks. Workers will not necessarily qualify for unemployment benefits, depending on their status, employment, and recent earnings history.
“A lot of people today don’t have a three-month cash reserve,” says Ted Jenkin, a certified financial planner and CEO of Atlanta-based oXYGen Financial. “If you get fired, it doesn’t have to be true, you get a compensation package.”
He added that workers should also check their expenses, which will determine how long their emergency fund will last. You should include student loans in these accounts — payments are due to resume after August 31, although the deadline may be extended, Jenkin said.
Moreover, it’s a good time for workers to make any necessary health appointments while they’re on their current insurance plan, especially since many people may have met their deduction for this year, Jenkin said.
Those with a 401(k) plan loan may also consider trying to speed up the repayment process. Laid-off individuals may incur tax penalties for failing to repay this loan within a certain period of time (usually 90 days) after a job loss.
Promote Professional Flexibility and Personal Branding
Woodruff said Santos said workers could also focus on enhancing “occupational flexibility” ahead of potential layoffs.
Many people focus on dusting off a resume during career transitions; But that’s not necessarily the key to finding another job, especially for those in the advanced stages of their career, she said. Personal branding and personal relationships become even more important.
Individuals can attend or participate in seminars at industry conferences, attend workshops, and post or share industry-related content on social media sites like LinkedIn — all in the service of connecting with their professional network, Woodruff-Santos said.
She added that workers who complete a team project could consider making a “shout out” on social media to promote the work and tag relevant team members, for example.
Exceling in the workplace and being a good colleague can help you in the long run, especially if previous colleagues remember your work and can help recruit you into another company.
“You cannot underestimate the value of those connections that you make in your current workplace,” Woodruff-Santos said.