How to Prepare for Layoffs or Recessions
Prepare for Layoffs in India? Although economic downturns and recessions are common in India, the threat of layoffs was not so publicized by media, until the last few decades. This does not mean layoffs and job cuts never existed. In fact job cuts and downsizing has been happening in India too, but these are not as common or frequent as in the West.
But, remember that the impact of layoffs in India can be harsher compared to developed countries because we don’t have unemployment benefits and other social security benefits like the west. Unlike the developed countries where unemployment of above 5% or maximum 10%, in India it is generally not below two digit figures if we go by reliable statistics.
So how to prepare for layoffs or recessions? We will answer this million dollar question shortly.
Manoj is a Business Analyst with a large offshore division of an US based Investment Banking Company on the outskirts of Mumbai, the financial capital of our country. In late 2008 his company’s parent declared bankruptcy leading to layoffs and job cuts globally. Manoj was a good resource and a key member in his team for the past year and a half.
There was a lot of talk and gossip in the organization about restructuring and changes in the company right from the cafeteria to parking basement. One fine day Manoj and his colleagues are informed that their division is going to be defunct and are provided a month’s notice to look for other opportunities.
How to Prepare for Layoffs or Recessions
If you foresee a situation where you might lose your position, you can take the following steps proactively in no particular order:-
1. Sharpen your skills
There are people who lose jobs due to lack of capabilities, mediocre performance, bleak future potential, lack of initiative, etc. If you are not proficient or atleast comfortable in the key result areas or key skills required for your job role, then it’s high time you sharpen your skills.
Skills can include technical skills related to a particular domain, knowledge of procedures, set of tools, software, applications, etc. that are necessary for the project or work. You need to do the following to boost your skills:
- Get trained on new skills at the company or elsewhere
- Show some initiative to learn by volunteering for certain projects/initiatives
- Invest time to complete important projects or milestones (where you get to learn)
- See how you can get more support from your peers and seniors to improve your skill sets.
2. Expand your network
This includes both your personal as well as professional network. It’s a good idea to speak to your batch mate or old friend to share your situation or meet for coffee or catch up on weekends. Try to maintain a good rapport and friendship with your former colleagues, contacts, clients, etc., which helps at times.
I used to be in touch with one of my friends over phone and email in the same city for a couple of years although we rarely used to meet. We met once where he discussed a consulting opportunity to design and develop a course. I was willing and took up the project.
When I lost my full time position at some point I was able to work on this project productively until I found another opportunity. This is a good example of how a friend can help.
There are also instances where a whole team moves when a person leaves the organization. This is due to the rapport and strong working relationships they enjoy as a team. Most people write good bye emails, which can get forgotten. Moreover, once you leave an organization you no longer have access to people’s official emails or personal contact numbers.
Hence, it is a good idea to collect contact information of your colleagues when you leave an organization. You can also request them for providing references that may be required when you join elsewhere. Maintaining a relationship should be regular social activity, not confined to times when you need help or assistance.
3. Commitment & Ownership
Generally people who are not sincere and show lack of responsibility or ownership are the first to go out either through layoffs or voluntarily. Good performers can face bad situations, but organizations will think twice before sending out a top performer, because they cannot get such valuable resources once the economy recovers.
So try to be committed and show a sense of ownership in your work, which should reflect in the quality, timeliness and sincerity.
4. Team Performance, Visibility & Initiatives
Good leaders are those who have taken key initiatives to benefit the team and the company. As you get in to bigger roles its not just your individual performance, but your team performance, team handling skills and initiatives that will decide your future growth potential.
5. Avoid Gossips, Have Open/Frank Discussions
Most people have a fear of discussing bad news with their boss, superiors or the key people who really matter. The normal attitude is to speak with their peers or buddies and speculate and gossip about ‘what will happen if X leaves’ or ‘what if ABC contract is cancelled?’ or ‘will we get our salary next month?’.
Although some casual talk once in a while is fine, this should not become a habit. If you have some concern that bothers you its good to discuss about it frankly with your manager or boss rather than joining the gossip monger group. Also avoid getting in to groups that have negative conversations or views about an individual or a company.
Similarly, try not to use harsh language or stance towards your superiors or the management. This can cause fatal damage to your working relationships as wells as your career.
6. Taking stock of work/project collaterals
During bad times you will either quit in a hurry or may not have time to take samples of your work, projects, etc. These are quite important when you have to demonstrate your skills, practical experience later on in interviews or other circumstances.
However, try to maintain confidentiality and integrity and protect any information pertaining to your internal strategies, names of clients, etc.
7. Increase your emergency reserve funds
In normal situations where you don’t anticipate a layoff, you must have an emergency fund to cover 3-6 months of your household expenses. If you don’t have one, you are at a high risk because if the inevitable happens you will be forced to sell your furniture, gadgets, etc or overspend on your credit card to cover your living expenses.
If you see that a recession or job cut is likely in the near future you can increase your savings to have a bigger buffer. Similarly, if you have a bigger family and more than 3 dependants then your reserve funds have to be increased to a level equivalent to 6 months’ expenses.
8. Find Secondary Income Sources
This is easier said than done, because most people think that they are always secure in their jobs. Secondary income is not a replacement for your job but just a secondary add on to help you earn additional income. During bad times this income can help you sail through comfortably without overshooting your credit card limits.
Ajay who was a Financial Analyst incidentally started working on a few web writing projects to earn small sums and also to learn about blogging, article writing, etc. He also signed up on a freelance website and received an offer from an investment website manager to write stock recommendations periodically.
What a coincidence! Although his web writing skills had no connection with his past work experience, overtime he was able to find an opportunity where he could mix and match his skills and abilities.
Similarly, people who are good at business or investing can try starting their ventures on a small scale pilot before scaling up. If you invest sometime and brainstorm about what you can possible do there are endless possibilities: –
- If you are good at swimming or athletics you could become a coach.
- If you are good at investing or real estate you could become a financial advisor or property broker.
- If you have talents in music, dance or drama you can become a regular performer within your community or forum
Like this we can go on and on and even find opportunities from cooking to baby sitting. Even if you could make a paltry Rs.4000 a month more from secondary sources, it can help you pay some of your essential bills and monthly expenses. To put it in a nutshell, be open to get started in a small way before you can think of a steady secondary income.
9. Health & Fitness
Most people today have forgotten the old saying ‘Health is Wealth’. It is important to maintain a good work-life balance during all times. This will help you maintain your health, fitness and improve your overall well being. Even when you lose a job it is important to eat well, get sufficient sleep and follow certain good habits like regular workout, diet, active lifestyle, etc.
There are some people (who got laid off), who try to skip meals, sleep a lot, etc. This is okay for a day or two but continued bad habits can ruin your health and further hamper your career prospects. There are a few who also get in to chain smoking, binge drinking and drugs, which is a perfect recipe for disaster.
10. Be flexible and adaptable
This seems like the last point, but this is the most important of all. When your situation is bad it calls for some flexibility so that you can adjust to the new situation at hand. If you are not able to find a position that exactly matches your profile, try to explore a few others which are closely or partially related to your skills.
For Example: Naveen who was a programmer with a small tech firm, was forced to take a break due to family circumstances. He starting taking interviews. During an interview, an Executive of a mid-sized software firm asked him a question about a programming approach/flow for a given situation.
Although Naveen was not conversant with the software/tool, he still managed to give a logical approach to handling the situation.
The interviewer was impressed and Naveen received an offer within a week. The secret behind this is Naveen’s ability to work across different systems, tools and platforms which gave him the holistic knowledge enabling him to get this opportunity.
So being flexible and adaptable is important at all times, and comes to your rescue during a recessionary phase.
Conclusion – How to Prepare for Layoffs or Recessions
There are a few myths or rather mental blocks that people have about bad situation which they think will not occur for them. Some say “I will not face this situation” or “I’m not that bad”, “I’m not among the black sheep”, etc.
Let me clarify that we are not trying to address a failure or poor performance alone here. There are several well qualified and experienced people who lose jobs too, despite their good performance. This can be due to change in business circumstances, organizational strategies, process of work, etc. In any case being prepared for eventuality with a Plan B is better than getting a pink slip all of a sudden one fine morning.
Job loss can also happen due to age related factors, health/fitness issues, changes in economy, which can be outside our span of control. If you follow the proactive steps discussed above you will be able to sail through the ‘bad phase’ until you get a better opportunity. If proactive steps are followed and implemented well, the ‘bad phase’ will rather be short and sweet. Hopefully these practical tips on how to prepare for layoffs help.