By Dr. Jarrod Sadulski
Faculty Member, Criminal Justice
Reductions in force or layoffs can occur without warning, and it is vital to be mentally and financially prepared for a layoff to happen to you. In 2017, I was part of a reduction in force with a former employer, and I well understand the stress associated with losing a job. However, there are six steps you can take before and after a layoff to reduce your stress and recover from the layoff.
Step #1: Have a Plan and an Up-to-Date Resume
Developing a plan before a layoff occurs is important. This plan will help you decide what actions to take after you exit a company.
In addition, ensure your resume is kept up to date. An up-to-date resume will save you time later and enable you to immediately begin applying for employment.
Related link: The Great Resignation and Resumes in Today’s Job Market
Step #2: Maintain Financial Preparedness
Another important step is to be financially prepared to survive a layoff. According to financial expert Dave Ramsey, it is best to have three to six months’ worth of monthly expenses in an emergency fund.
That emergency fund can be used to:
- Pay medical bills if you have a sudden illness that prevents you from working
- Pay cash to mitigate a major emergency
- Handle your expenses after a layoff
Unfortunately, most Americans do not have an emergency fund that will allow them to pay three to six months of living expenses. In a recent survey, 64% of Americans live paycheck to paycheck and would be unable to cope with sudden major financial expenses.
Step #3: Explore Your Health Insurance Options
Once you learn that you will be laid off, explore the health insurance options that may still be available through your employer. Maintaining healthcare during a job transition is essential because an accident or sudden illness can be financially devastating if you don’t have health insurance.
Your previous employer may be required to provide healthcare benefits for a certain time after you are laid off under the Consolidated Omnibus Budget Reconciliation Act (COBRA). COBRA is a federal law that provides qualifying workers and their families the right to continue group health benefits under their group health plan in certain circumstances for a limited amount of time.
If COBRA doesn’t apply or your time runs out, it may be helpful to talk with friends who are self employed and others who have been laid off regarding the healthcare options that work for them. Also, consider talking with your healthcare providers (such as doctors or dentists) to see if they offer any alternate options for payment. You may be able to obtain a reduction in your total bill or to work out a payment plan that won’t destroy your budget.
Step #4: Check into Unemployment Benefits and Create a Budget
After you are laid off, explore whether unemployment benefits are available to you. Also, work with your household members regarding the financial impact of the layoff; some of them may need to work extra hours to supplement the household income.
Ideally, create a budget and cut unnecessary expenses to stretch the emergency fund. These expenses could include:
- Eating at restaurants
- Cable service
- Vacations
Step #5: Reach Out to Your Professional Connections
Maintaining a robust network of professional connections can be especially helpful during the job search. Reaching out to those connections about job opportunities may be useful as you pursue employment.
Leveraging job search tools such as LinkedIn and Indeed are equally helpful. ZipRecruiter and Monster are also great resources during your job search.
Related link: Higher Education Networking during the COVID-19 Pandemic
Step #6: Develop New Skills Before a Layoff
Prior to a job search, you may want to make yourself a more attractive job candidate by developing new skills. For instance, you could take college classes or complete certificate programs or other training courses.
Ultimately, no one wants to experience a layoff. But if it occurs to you, be sure that you have fully prepared for it.
Comments are closed.