What to Do When You’ve Been Laid Off

If there’s one term that almost every employee fears, it’s “layoff.” Most people will be impacted by a layoff at some point in their career. But if you’ve been personally impacted by a job loss, you likely need more than just data; you need advice on what to do next to make it through an incredibly tough situation. 

Changing economic conditions, technological and social disruptions, and even political or legal actions can cause layoffs at individual companies or even entire industries. Thankfully, this means there are well-known actions and support structures in place designed to help those impacted by unexpected and sudden job loss. 

Understanding the Terminology Around Layoffs

Before you take action after suffering from a layoff, it’s important to understand key terms related to your job loss. Not every type of job loss is considered equally. Losing your job unexpectedly generally has the same emotional effect, but how you lost your job, especially how your employer defines it,  can greatly impact the level and type of support you may be eligible to receive.

“Layoff” Meaning

According to the U.S. Bureau of Labor Statistics, a “layoff” occurs when an employee is terminated by their company from no fault of their own. This type of termination is not related to an employee’s performance but to internal or external factors affecting business decisions. These could be, but are not limited to economic downturns and organizational restructuring (especially following a sale or merger). 

Despite common beliefs, not all layoffs are permanent. Some are temporary, with the expectation that the employee will be hired back in the future once conditions have changed. However, a layoff is a complete separation in employment instituted by the employer, under no fault of the employee. 

If you were laid off, you are likely eligible for unemployment benefits.

“Furlough” Meaning

A furlough occurs when an employee is forced to take a leave of absence from the company. Furloughs typically follow economic downturns or disruptions that impact a company’s ability to pay its employees. However, furloughs are usually temporary. Additionally, during a furlough, employees keep their employment status with their company and usually also maintain certain other benefits, including access to employer-provided healthcare plans. 

If you were furloughed, you are likely eligible for unemployment benefits. 

What Does It Mean To Be Fired?

If you were “fired” from your job, it was likely due to performance issues, a breach of your employment contract, or a violation of company rules. A “firing” is generally a negative consequence of your own actions. If your company fires you, it should have maintained records, such as performance reviews and other documentation, that provide a paper trail for your firing. Legally, the company must maintain these records in case it’s charged with wrongful termination or disparate treatment.

If you were fired, you may not be eligible for unemployment benefits.

Furlough vs Layoff

The key difference between a furlough and a layoff is the employment status. While layoffs could be “temporary,” that depends on whether the company decides to rehire laid-off employees. Conversely, furloughed employees maintain their employment status and may still receive a fraction of their normal pay, or none at all. They retain many other employer-provided benefits throughout the furlough period.

For the sake of unemployment benefits, most states treat furloughed and laid-off employees the same.

Laid Off vs. Fired

The difference between a layoff and a firing is in the cause. Layoffs occur when the employee is not at fault. A firing occurs when the employee has done something wrong or failed to live up to contractual expectations that were agreed to upon hiring.

What To Do After You’ve Been Laid Off from Work

If you’ve been laid off from work (and you’re sure that your termination fits within the technical definition of a layoff), your immediate actions should cover the following:

• Securing your finances and reviewing expenses
• Planning for your next job
• Leaning on your personal support systems

It may take several weeks to get through your to-do list, but you should act as swiftly as possible on these tasks. 

Secure Your Finances

Not much else will matter if your finances aren’t secure after a layoff. Take the following steps to secure your finances:

1. Cut Unneeded Expenses

First, review all of your existing expenses. Cut out anything that you don’t need, such as recurring music and video subscriptions. U.S. consumers spend an average of $1,600 per year on subscription-based services, with most people spending around $100 per month more than they think they are. This is a good first step as you can accomplish this task in just a few hours.

2. Negotiate for Severance Pay

Particularly in the U.S., companies are not required to offer separation packages or severance pay. However, that does not mean your company won’t offer this to you. If you’ve been laid off, contact the HR department immediately and begin negotiating some type of severance. Many companies are amenable to this, as it’s a good way to maintain a positive relationship with high-performing employees that they may want to rehire in the future.

3. Restructure Your Budget (or Create One)

Losing your primary income stream makes budgeting even more important. If you already have a budget, review it for additional expenses that you can cut or reduce. If you’ve never made a budget before, now is the time to start. Budgeting apps abound, and there are many websites that offer recommendations on how to create a budget when you have very little or no income stream. 

Also, consider your housing in your budget. Housing is often one of the largest expenses for most people. If you have a mortgage, contact your mortgage provider and let them know about the layoff. Ask for a mortgage forbearance or for a modification to your payment amount for the next several months. For renters, speak to your landlord or rental company to ask for a similar bit of grace related to payments.

4. Review Your Healthcare Expenses and Coverage

Healthcare remains one of the biggest monthly expenses for most people. Losing access to your employer-supplied healthcare plan does not make your healthcare needs (and sometimes the costs) disappear. If you’ve been laid off, there are a few things to note about healthcare:

• US Federal law requires your company to continue offering you healthcare through COBRA Continuation Coverage. Speak to your HR team to understand how this works through your employer, as there may be slight differences in costs and what’s covered under the plan.
• You may end up having to pay more out of pocket than you did previously. However, you will still pay less than securing private healthcare insurance.

Account for the changes in healthcare coverage and expenses in your budget. 

5. Apply for Unemployment Benefits

As we noted above in the definitions section, if you’ve been laid off (or furloughed), you can, in most cases, apply for unemployment benefits. However, if you’ve been fired, you are unlikely to be able to receive these benefits, since you’ll be considered at fault for your own termination. 

If you plan to apply for unemployment benefits, these will come through your state of residence. 

Check for your state on the US Department of Labor’s listing of unemployment insurance offices and contact information. Make sure to apply as quickly as possible after you’ve received an official termination letter from your employer.

Begin Planning For Your Next Job

Take some time to process and work through the negative emotions you’ll experience following a layoff or job termination. While you will want to begin planning for your next role, your emotional and mental health are too important to leave to chance. 

Once you’ve had time to process, take these steps toward securing your next job.

1. Update Your Resume

Unless you were already planning to quit and move to another job, your resume is likely going to be out of date. Now is a good time to review and update your resume to reflect the most recent accomplishments and skills you’ve acquired since your last resume update. 

Areas to consider updating on your resume include: 

• Contact information
• Professional summary
• Work experience
• Skills

Depending on how long you’ve been working in your field, you may or may not need to focus on updating your education section. This becomes less important the longer you’ve been working as more employers focus on hiring based on experience than on education. Nevertheless, if you’re still junior enough in your field that education matters, update that section as well.

Additionally, make sure that you have an ATS-friendly resume. Many companies use Applicant Tracking Systems (ATS) as a first step to filter for the most desirable candidates. Your resume structure and what’s on it may positively or negatively impact how well your resume performs within these systems. 

2. Build Your Professional Network and Personal Brand

Don’t underestimate the strength of your professional network. Data is all over the place on this topic, but some researchers suggest as many as 80% of jobs are filled through personal and professional connections. This is one of those situations where it definitely doesn’t hurt and will more than likely help, if not immediately, in the long run. 

The starting point here is rather obvious: LinkedIn. Make sure your LinkedIn profile is complete. Change your employment status here. Update your skills and experiences. Link to any professional content or pages that speak to your work. 

Once your page is complete and has the most relevant information about who you are, start building a personal brand on the site. Follow and connect with other individuals in your field and industry or in fields and industries you want to move into (especially those with hiring authority). Join and stay engaged with LinkedIn communities that interest you. Create content and post regularly, and engage positively by commenting on others’ posts to help keep yourself top-of-mind when jobs arise and leaders start looking for potential applicants to recruit and hire. 

You can find a large number of courses on personal branding through LinkedIn Learning. 

3. Explore Potential Career Pivots and Continued Learning Opportunities

In an ideal world, you’ll only be out of work for a few weeks, at most. But you should also plan for the worst to happen. Lay the groundwork for new roles by expanding your skills with continuing education.

If your busy work schedule made personal and professional development more difficult, use this time to build up your skills. While companies are hiring, they often struggle to find the right hires due to growing skills gaps. Research the most in-demand skills for the roles you want, and carve out some time to take continuing education courses to help develop or enhance those skills. 

Layoffs are also a great time to consider a major career pivot. As you’re more likely to have the time to start taking courses and building skills, consider doing so within a career path you most want to take. Instead of focusing solely on getting the same type of job, think strategically about how you can leverage your past experience to make a major movement in your life, including getting hired into leadership positions or into a completely new field. 

 

Lean On Your Personal Support Networks

A layoff is challenging for just about everyone. Your personal support network can play an important role in not only helping you manage the situation emotionally but also professionally and financially. Take time to understand the impact that a layoff can have on you and your family, and consider how those around you may be able to help. 

Acknowledge That Job Loss Can Impact Your Mental Health

Don’t discount or ignore how job loss can impact your mental health. Most people place a lot of pride and self-worth in their jobs and careers. Layoffs can disrupt those positive feelings and cause unanticipated psychological trauma and depression. 

Common coping strategies include: 

• Acknowledging that your feelings are real and legitimate
• Giving yourself time to mourn the loss of your job
• Maintaining a daily routine or schedule
• Creating a budget to help alleviate financial stress

Speak to family members and friends who have experienced layoffs and job losses. Ask for advice and an open ear to discuss your feelings. You may be surprised by how many individuals in your life have been through what you’re experiencing and how many are willing to lend a helping hand while you get back on your feet. 

Don’t Be Afraid To Seek Professional Help and Counseling

Never be afraid to reach out to professional counseling services during a period of significant change, such as a job loss. While culture in general has made huge strides in normalizing self-care through professional services, you may still be hesitant to let others in your life know about your struggles.

Professional services exist that can help you deal with the emotional and personal challenges that come with a layoff. These include remote counseling services such as BetterHelp or religious institutions.

Down But Not Out: A LayOff Isn’t the End of the Road

There’s no way to mince words on the fact that layoffs are always a terrible experience for employees. Thankfully, layoffs are usually temporary. As long as you remain focused on growth, your next role is always right around the corner. Take the steps you need today to make sure your essentials are secured. Doing so will significantly decrease the stress you’re feeling right now. Then, focus on ramping up your professional materials, networks, and skills. Doing so will make you favorable in the eyes of potential employers and make that next role not only easier to land but possibly better than the one you left behind.