10 Actions to Prepare Yourself for Layoffs
You can't stop your company from conducting layoffs, but you can prepare yourself to reduce the negative impact to you and your family.
I wrote this article around the time Amazon did their last big layoff. Felt like time to quickly update it. I made this article free, because it occurred to me that I didn’t want people worried about being laid off feeling like they had to pay to subscribe to read about how to handle layoffs. Felt weird.
We all wish that layoffs didn't exist. It'd be nice if we had guaranteed jobs for life. Furthermore, as a random side note, I didn't intend this to be a classic "10 things" list. I had 6 items in the list initially and mistakenly ended up with 10 items while doing editing. It's a bit of a cliché, I suppose.
However, we control some things in life, and some things we don't control. There are many famous quotes about how we need to accept the things we don't control and act on the things we do. So this article is about what actions you can take pending layoffs.
Layoffs. Always a bummer. Companies make mistakes. They want to impress their shareholders. They need to save money. Whatever. These are things we can't control.
Some people will be fired. What can we control in that situation? Resilience. Making yourself resilient to the vagaries of life. By the way, vagaries is a fantastic word. Apologies for using less common words, in case you had to google it.
I will walk through ten specific things below (in no particular order) that will help you prepare for upcoming or potential layoffs. They won't prevent a layoff. They won't save you from the negative financial impact. However, they'll help reduce the negative impact on you and your family.
1. Take advantage of your benefits and do your expense reports
I pay for a healthcare plan through the Washington exchange, but it's not the best plan. It's a cheap plan for a healthy family. We're lucky like that.
However, it has a big deductible. Many people will move to cheaper healthcare plans (or go without) if they lose their positions.
If it's possible that you'll lose your job, use your benefits. Visit the doctor and dentist. Get new eyeglasses. Buy and expense that newsletter or gym membership (if you're that lucky that your company pays for that kind of stuff). Take some pens from the office supply room. Just kidding. Those pens are terrible. This was a test to see if you were still reading.
Whatever it is that your company will pay for, now is the time to get those last expenses booked and paid for. One more thing you can save on for when you're not working.
And no matter what, get all your expenses filed right away. Companies will usually make good on your expenses even if you’re laid off. But do you really want to try to fill those out while not at your corporate offices? Make sure your expenses are immediately filled out. Get those submitted ASAP.
2. Refresh your work social network
How is a social network valuable when you need a job? It may be obvious, but let me go over a few specific things.
Someone inside a company can put your resume in front of a recruiter, getting you past the huge resume pile.
They could also talk to the hiring manager, and put in a good word.
Even if a position isn't posted, they may know of a position opening, and get you into the queue before the crowds.
For the interviewing process, they'll have a better idea of what the company is looking for, and can give you advice.
If you fail the interview process, it's possible they can get some hints of what you did poorly (since companies rarely provide that information officially) so that you can do better on your next interview.
I have repeatedly put my finger hard on the scales to help someone I know to get a job. There are many things an internal employee can impact to give you a better shot at a position. Getting you past the resume screen is a simple start.
Considering that incredible value, how do you make it more likely someone will help you out? Don't reach out to them for the first time in 5 years to ask them for help.
Reach out now, while you preferably still have a job. Say hi. Perhaps check to see if you can help them with anything. Make a small human connection, to keep that relationship fresh.
It might feel nice to the other person to be remembered, and you never know when you'll need that relationship later.
Who do you keep in touch with? The people at companies you like, and the people you liked working with. That manager you enjoyed working for 6 years ago. That co-worker who went off to Google. That person you met at the conference who recently moved to that newer hot startup. It might be a little selfish, but it's social investing for your future.
3. Get things from your work laptop or phone
If you are laid off, it's likely that you'll immediately lose access to your company resources, including your laptop and phone. What's on there that you might need?
Did you end up storing some personal photos in a folder? Copy them off.
Do you have all your co-worker's contact info? Make certain you have work and/or personal email addresses for those you'd like to keep in touch with. That internal directory won't be available.
Is it possible you saved important passwords in your work browser? Make certain you can log into all systems without that laptop.
Do you have any 2-factor auth setup on a work phone or laptop? Make certain you don't lose access to an critical system.
Is there work product you're allowed to take? For example, some designers are allowed to take designs they've made as a part of their portfolio. Good time to archive off that stuff.
Many of us end up using our work laptop for more than just work, so you need to make certain you're not shocked when you lose access to it.
4. Make yourself more valuable at your current company
Are you worried the layoff hammer might hit your company or organization? Too often people just hold their breath, nervously doing their job like usual, hoping the hammer won't hit them.
In some cases, entire organizations will be cut. Not much you can do to prevent that.
At other times, organizations need to cut several people. How do you avoid being in the list of people cut? You make yourself visibly valuable.
Heading into layoffs is not the time to relax if you want to keep your job. It's not the time to carefully maintain a work / life balance. This is a pivotal moment in your career, and you can't let it pass by.
Volunteer to fix emergencies. Help fix the system outage. Write the last-minute document for the meeting. Problems have one distinct thing going for them. They tend to be smaller (so you can address them quickly), immediate, and visible.
Talk to your manager regularly. Don't skip your regular one-on-ones. Communicate clearly and positively. Managers are humans, and humans don't have objective measurements built into their brains. If they are asked to fire people from their team, it's more likely to be the people with which they have less connection.
Complete your work on or ahead of schedule. As I said, this is not a time to carefully maintain work / life balance. You'll have a ton of time to rest if you're fired. Put in extra work. Get one more task done. Everyone has a very short memory. If they need to fire one person, they'll remember who did the most in the last sprint, and who did the least.
If they're not firing entire departments, it's unfortunately a bit of a competition. Assuming you want to keep this job, you need to stand out from the crowd.
5. Cut expenses immediately
What's most people's #1 concern if they're laid off? Finances. They have bills to pay.
What makes you financially healthy and able to withstand a layoff? You need your expenses to be covered by savings.
Financial health = Savings - expenses (over a period of time).
How much in savings should you have? In a perfect world, you'd have 30 years of expenses. Why? Because then you could retire. How cool would that be?
Otherwise, the answer is, 'however long you might need to go without a job'. Many people would suggest a 6-month buffer, to enable you to go at least half a year in a difficult and stressful job search. So if your expenses are $100k a year (an easy to divide number), you'd need $50k in the bank, available to pay the bills. Preferably not invested money because we've all seen what is happening to the stock market. I'm talking about cash.
If layoffs might come in 5 years, I'd argue for various ways to save more and make more.
If layoffs are close, or just happened, you can only control one side of that equation. Your only option is to reduce expenses.
How do you know your expenses? I like consolidating all our family expenses into a tool. We use Personal Capital, but others use Mint (or similar tools). Usually, you enter your credit cards / bank account information into these tools (be careful to use a reputable tool), and it'll pull your transaction information to figure out your expenses. You'll need to eyeball it & potentially fix things it misunderstands. Like that transfer from checking to savings that it thinks is an expense. Stupid software. Alternatively, if you watch your bank account balance for a few months, you might be able to drop that info into a spreadsheet and figure out your average expenses. Make certain you're including less regular expenses like property taxes.
How do you cut expenses? Like you cut features from a project which is overdue. You start at the least important, and keep cutting until you find it unacceptable to keep going. But think deeply. Is this really a stopping point, or are you just reluctant to change your lifestyle?
Why should you cut expenses now, instead of waiting? Because you want to start building up larger savings. You want the expenses to stop right now because it takes some time to stop the expenses (at least a month delayed for some services). A potential layoff is a financial emergency, and you don't want to only react to the emergency when it happens.
A few random things to consider:
Consumer Credit. If you have anything apart from a mortgage, I'd suggest you work on cleaning that up before everything else. Consumer credit is simply borrowing against a future you. If "future you" loses their job, they'll hate that you didn't pay off that car / credit card / layaway plan first. If you're already laid off, start contacting your creditors if you're in trouble. Many creditors would rather cut a deal with you, rather than you stop paying completely.
Health insurance costs. You're going to want to pay for health insurance if you're laid off. Ensure that you have this cost in your estimate of your expenses.
Restaurants are super expensive. Doordash adds to that cost. Cook at home. Cook a week's worth of food and put it in the fridge/freezer (countless websites to explain how to do that, simple google 'meal prep recipes'). We have a family of 6, and I know couples who spend more on food in a week than we do in a month. You know what's simple & healthy & tasty? Stew. Chili. Soup. Things that can be made in 30 minutes in a giant pot, and feed you for days.
How many streaming content services do you need? We use Spotify for music, Amazon Prime for shipping / content, and Netflix. That's 3 services, and I feel like I'm basking in more content than I could possibly consume. Yet, I talk to people who pay for twice as many services (or more). If you have that much time to consume content, you might want to find a hobby.
Expensive purchases. At times, regular bills aren't the problem, but $5k purchases add up. The new couch. The flights to Hawaii. You can buy what you want, but if you're concerned about your financial stability, this isn't a great time to splurge.
I'm coming across as a bit strongly worded here because I think high earners are often hesitant to pull back on their spending. "I couldn't possibly get by on less than $150k a year." Nonsense. Drives me crazy. You choose to spend that much. You can always choose to spend less. It's your choice if you want to take action to deal with a potential emergency, or just cross your fingers and hope for the best.
6. Update your LinkedIn and resume
There's no downside to updating your work profiles. The only reason we don't tend to do it frequently is that it's a pain. It's annoying to sit there, and try to wordsmith our experience into something that sounds good.
However, a worse time to update this information is when you've lost your job, and you're rushing to start interviewing for new positions.
Sit down for some quiet time, and work on updating your LinkedIn profile. Follow that link, and make certain your profile looks professional. Once you're done, I'd either export it directly to a resume (LinkedIn has that feature), or copy/paste the information into a decent resume format.
Many communities (such as the CS Careers Hub on Discord) will help you edit your resume for free. Plenty of paid services as well if you're interested in professional help.
Much more important than a perfectly worded resume is that it's updated, has content, and reflects your abilities so that you can get to the screening stage. After that point, it's your ability to interview which will get you the job. For more help with your interviews, I’d love you to read my articles about interviewing.
7. Don't burn bridges in any way
The world is a small place. Don't burn bridges because you never know what bridge you'll want to cross later.
Don't insult your employer. It appears petty, and immature. You may have been 100% screwed by that employer. You gain zero advantage complaining about it. You know who you are? Someone who was successful. "I worked at XYZ company, and achieved great things there. It was time for me to move on."
Don't insult your co-workers. It also appears petty. Your manager may have fired you. Your co-workers may have sabotaged you. It doesn't matter. You know who you are? Someone who gets along with their whole team. "I had great co-workers there. I'll miss them all."
Don't complain about your bad luck. Bad things happen. Yes, you were hit by a layoff. Yes, times are rough. Explain your depression to your family and close friends. You don't want future co-workers to feel bad for you. You want them to hire you. You know who you are? Someone who is positive and energetic. "Yes, there were layoffs, but it's ok! I'm excited about these opportunities."
Here's a key to remember. Everything you say in public is part of your interview process. You want everyone to see you as a great co-worker, a future friend, a colleague who'd be the best colleague ever, and someone who achieves great things. Any information you share outside of that, reduces your chances of being hired.
8. Investigate the layoff process, negotiations, severance
You should always keep track of what is shared regarding your company's current status. How do they communicate layoffs? What is the severance? What's the timeline? How much healthcare do they pay?
Sometimes companies have voluntary severance, where you can volunteer to leave for a decent pile of cash. Occasionally, that pile of cash is larger than they'd give people later when they're involuntarily laid off. If you're ready to search for your next job, it may be worthwhile to take the voluntary leave.
The biggest thing is that you are prepared. Knowing the numbers will help you prepare your finances. Knowing your options gives you more ways to react to next steps.
9. Don't panic
Like the Hitchhiker's Guide to the Galaxy says, you want to avoid panicking. I've seen people express various forms of panic at the thought of losing their job. Do you think that the stress and panic will make you better at your job? Unlikely.
What do some people do? They start interviewing immediately (see below). They start asking their manager daily if they're being laid off (see #4 above). They start complaining about their company (see #7 above).
Act on the preparation steps in this article. Work through what you can control. Take some nice long walks with your family. Start a pleasant exercise routine. I assure you that feeling healthier can change your world view.
Control what you can control, and let the chips fall where they fall. A calm and rational approach to the situation is best.
10. Don't interview immediately
Were you fired? Do you know that you'll be laid off? In many situations (like late 2022), a pile of companies conduct layoffs. Hopping between positions doesn't necessarily reduce risk.
If you're going to be laid off, you're likely to get a severance. That will help tide you over while you look for a new job. If you're not going to be laid off, you're likely the safest if you stay put.
When Amazon locked down their hiring, I knew some Amazon employees were immediately hunting for new jobs in safe places. What places were they considering? Safe companies. Companies that hadn't yet announced their upcoming layoffs. More than once, I heard of someone getting an offer from a company that has since announced layoffs.
If you've lost your job, feel free to start interviewing immediately. Otherwise, I'd suggest holding on to your job with both hands.
Make yourself resilient
There's a common pattern in what I wrote above. It's about resiliency.
Currently, many people are stressed about layoffs, and the state of the economy. But this has happened before, and will happen again.
Heading up to 2000, we had a tech crash. Layoffs. I remember worries across the tech field that everything would be outsourced, and there wouldn't be well paying tech jobs left in the US.
In 2008, we had a financial crash. We had various levels of panic that the entire global financial system might collapse, there would be a multi-year depression, and so on.
This crash may be worse, it may be better. You can't control that. What can you control? Being resilient.
You should always maintain a social network. It's healthy. It's also a tool for resiliency.
You should always make yourself valuable at your current company, and investigate how to grow your career. I'd always choose an exciting and engaging career, rather than one where I just hope the day ends.
You should always maintain a financial safety net. It reduces stress, and prepares you for any contingency.
Your goal can't and shouldn't be to avoid a global financial crisis. Instead, focus on what you can control. Work on ensuring that your family can weather the inevitable storms.