There are 4 main layoff types:
1) Budget Cuts (Mass layoffs)
2) M & A
3 Offshoring
4) Business Line Deterioration
Here I'll give examples for each, what to look for, and how to prep.
1) Budget Cuts/Mass Layoffs
Whenever you hear the term "mass layoffs" in the media, it's usually because we are in times like now or because companies cannot find any more savings in the budget.
CEOs have to answer to shareholders and protect their own wallets, so sorry Bob in AP. ✌️and GTFO.
These types of layoffs can go a few ways and are the most common. Generally, the C Suite gives the order to purge, but they don't get their hands dirty cuz who wants that smoke.
So the VPs get their number that they need to hit and to get there they usually axe the:
1) Highest paid
2) Closest to retirement
3) Underperformers
4) People they don't like
5) Combo of 1-4
Now it's just an Excel exercise, finalize the #, and send the hit list to HR.
If any of these sound like you, make sure you got a good severance lined up if you get canned and prep that resume. Having a good relationship with your direct decision maker also helps. Politics can play a part here.
2) M & A
This is the easiest one to explain.
If your company is getting bought by another company, START PACKIN!! The larger company, 90% of the time, cans the redundant or duplicative target's staff.
It usually starts with the target company's C Suite. Don't need 2 CEOs.
Good news is that there is usually a runway before the cuts come, which varies, so the acquiring company can see how the target does things, find out what it does best, adopt it, and THEN kick you out. Cleaning the bones on a dead carcass. Got to get their money's worth.
3) Offshoring
Offshoring is exactly that: moving jobs out of country. Why?
1) Cheaper - have you seen the FX rate of INR to USD? Easy money.
2) Stability - nobody in the US wants to work at a call center, but they are lined up in other countries.
US jobs that historically require sheep skin go to India. Jobs in IT, Audit, Data, Engineers etc.
Non degree jobs (making stuff) can go anywhere cheap and has a stable workforce that can churn out widgets at a high rate.
Silver lining with Offshoring is that these jobs tend to rotate back to the home country every few years, at least that has been the case historically.
Remote work has also made it easier for US workers to find jobs with international firms.
So anon, if the company you work for starts sending you to other countries to "train" or do a "knowledge transfer", that means you better look to GTFO and your days are numbered.
4) Business Line Deterioration
This is where the particular line of business just isn't profitable any more or doesn't offer any benefit to the company. Most times the company will try to divest it, but it doesn't always pan out.
- A neurosurgeon at a hospital leaves or croaks (yes I've seen it happen) and the support staff no longer needed.
- Retail brick and mortar pulls out of a certain state. Rite Aid in HI years ago.
- Amazon Care telehealth business falls apart. No spinoff.
- Widget plant closures.
These are sometimes hard to detect and can be sudden, as one of my examples above was.
In these situations though, there will be a wind down period, so once it is announced, start the job search. You may have a year, at most, before it's kaput.
Ways to mitigate the risk of getting laid off and preparing for when it does:
1) YOU ARE EXPENDABLE. This mindset will temper your expectations and keep you objective.
2) Have a good relationship with your boss, management and coworkers. People struggle cutting people they like.
3) Don't underperform. If you have preformed well historically, less chance you get axed.
4) Know your severance policy.
5) Network often and leverage it when the time comes.
6) Make friends with recruiters. They are the gate keepers to jobs if your network is sparse.
7) Keep your resume updated with ALL your skills and experiences, then mold it to the jobs you apply for. Will reduce time to apply for jobs.
8) Have a side hustle or second job that can help offset some income loss.
9) Save your coin. Keep 6 months worth of expenses liquid.
Thanks for reading and subscribe.