Press "Enter" to skip to content

How to Deal with Layoffs

It occurred to me for better or worse I might have some useful knowledge to impart in the area of dealing with layoffs.  In my 15 year career, I’ve experienced 4 rounds of layoffs.  For better or worse I have never been laid off myself, but that doesn’t preclude their significant impact on my career.

Layoffs Versus Pay Reduction

It’s been 11 years since I’ve experienced layoffs in my own organization.  I have witnessed them in other divisions of my current company, but I’ve been fairly insulated from them for some time.  My current company favors across the board pay cuts when money gets tight, as they did during 2008.

Single Layoffs Can Be Beneficial

Before I get into my pre-2008 layoff experience let me first say, a single round of light layoffs is not always a detrimental thing to the masses of a company.  There are people you will meet in your career that are just coasting, taking advantage of the paycheck and being general impediments to getting things done.  It may sound callous, but a light layoff that gets rid of the people built up over the years that do not pull their own weight can be beneficial to the company and the moral.

Single Round Layoffs Are Rare

However very rarely is a layoff a single round, light, or targeted at what can be affectionately called dead wood of the organization.    Today’s post is not going to focus on the white unicorn of layoffs, as that is usually not how it goes down.  The layoffs I went through were Layoffs, with a capital L.  From what I’ve heard over the years these are much more common.  Quite frankly layoffs are expensive to a company so they don’t tend to occur unless something is seriously wrong.

Which brings us to our first and second examples.  Way back in college I took some time off to work 9 months at a larger software engineering firm.  It was the dotcom boom.. until it wasn’t.  Over the course of the 9 months, I witnessed 3 rounds of layoffs.  The first level manager laid off the day he got back from his vacation.  The programmer laid off 3 times and hired back 3 times in 9 months.  The HR recruiter no longer employed when I wanted to come back for the summer the next semester.    Laid-off employees being walked out under escort.  The bomb threats on site…. (yes there were and it shut down the site for a few days).

Big Layoffs Go After The Well Paid

That was an extreme example.  Probably even more so then what most companies deal with as that particular organization had serious issues.    But it did provide some stark lessons to this young man of then 20.  The folks that were cut were not necessarily the deadwood.  No, as is often the case they went after the higher paidSure ageism is illegal, but that doesn’t mean the man at the top of the salary range can’t be targeted age and ability be d#@#ed.

Those Who Exit First Exit Best

The second lesson out of this situation was that the people let go in the first round or even in the voluntary pre-round got the best deal.   The first round got 2 weeks of severance per year of service.  Not club med, but for a good worker who has been around a while probably enough to find another opportunity.  By the last round, this was down to only slightly better than local unemployment insurance.  That particular state factored your severance into whether you got unemployment, so it was nearly a wash to being let go with nothing.. ouch!

No Guarantees

The third lesson was some people volunteered in the first round and were not allowed to leave because they were deemed critical.  Then a few rounds later were laid off anyway.  The underlying message is once layoffs are started there is no guarantee you are safe.

He Who Remains Is Disgruntled

The fourth lesson actually came from not being the person laid off.   When a deep layoff happens, the morale of the remaining folks’ craters.  Everyone lives in fear that the other shoe will drop (see lesson 3).  Even worse, someone has to do the work of the good people caught up in the second net.    So the people left working at the company don’t necessarily get the better deal.  They get to keep their paycheck but they might end up doing twice the work to keep it.

Which brings us to our final two lessons, for which we must pass to my third and fourth round of layoffs.  My third round of layoffs was post University at my last employer.  Early in my time there they did a layoff localized of my department, as they basically outsource all of IT.  I moved to the business, avoiding the layoff and launching the rest of my career as it is today.

Demoralization Usually Stays Within the Business Unit  

From this, I learned a localized layoff is just that, localized.  The demoralization and other issues I mentioned above don’t apply to other groups within a big company if they target specific organizations.  Why?  Because usually, they don’t ask other groups to take over that organization’s work, there is no fear of contagion, and sometimes you don’t even know folks affected.    

Layoffs Limit Promotions, Duh

Finally, we come to my last layoff experience at my prior employer.  They basically forced the entire staff to reapply for their jobs.  At the time I was already considering asking for a promotion or attempting to find one in a different department.  Instead, I looked elsewhere and found my current employer.  In other words, even if you do survive the layoff your future career options will be stunted for a while if you stay with your existing employer.    They can’t layoff 20 people and then give you a pay raise.  

Layoffs Are Probably A Sign It’s Time to Move On

What does it all mean?  Frankly if you expect your company to go through a normal non localized multiple rounds of layoffs, or even suspect the layoffs are going to take out more then the deadwood, it’s probably time to look for employment opportunities elsewhere.  It’s good to always be interviewing elsewhere anyway to keep your interview skills up and your ears open for opportunities, but in the case of layoffs, odds are high a better opportunity will exist elsewhere.

Have you ever been through layoffs?

5 Comments

  1. Joe
    Joe October 28, 2019

    I’ve been through a few when I was an engineer. It was very demoralizing. You have to do more work with this fear of losing your paycheck. It builds up over the years too. Eventually, I became disgruntled and didn’t like working there anymore. It was just a part of working in a cyclic business. There will be layoffs.

    • FullTimeFinance
      FullTimeFinance October 28, 2019

      Ahh that’s right you worked in semiconductor space. There use to be a division of my current company in a related space. They seemed to layoff every two years like clockwork. I’ve never been in such an industry myself.

  2. fiberguyr1
    fiberguyr1 October 28, 2019

    Layoffs, or as my company likes to sugarcoat them Reductions in Force, happen every July for the last 11 years. It’s gotten to where it doesn’t even blip on my radar now, and I usually only find out when I try to reach out to someone only to find that they are no longer here. I’ve had to have some talks with our newer employees to let them know that they don’t make enough money to be in the consideration yet. But it still sucks, and frankly production goes down in the June/July timeframe as people are just waiting to find out how big it will be and where. The company is 70k+ so the number is usually in the 2-5k range.

    • FullTimeFinance
      FullTimeFinance October 28, 2019

      What a poor way to manage employee morale. Why do you stay?

    • Max Cantor
      Max Cantor November 16, 2019

      70K workforce = pretty large.
      You can expect layoffs at least once a year.
      Now, since you are familiar with that drill, why not interview during (and before) it ?

      Make your own “escape”.

Leave a Reply

Your email address will not be published.