In competitive and rapidly changing markets, layoffs are a possibility in any industry, at any time, and are bound to send shock waves through an organization. When companies have any size reduction in force, nervousness about the stability of the organization is created among the “survivors.” But does a layoff automatically mean a company is going under? Not at all. A number of much more personal factors come into play and should be taken into consideration instead of letting panic take over.
When a layoff occurs, companies may release public statements about the decision, offering strategic business goals and objectives as the driving force. Organizations often change direction in response to market needs and pressures or will jettison one line of business and start hiring in another. Some companies will experience performance issues that might foretell a decline, but no workforce reduction is going to be the same as another. Understanding the specific impetus for the layoff is a huge part of how remaining employees should evaluate and respond to the situation.
For individuals who sense a change in strategy or an impending layoff, communicating with your manager will be a valuable source of information. Recognize that business realities and the goal of a successful future are what is driving the reduction. Are you in an area that is a high contribution group? Does your department generate revenue or is it a cost center? Is your business primary to the business, or is it on the perimeter? Reductions are based on positions, not people, and the group you are in affects your risk for reduction.
Many people will want to ask their managers directly if they should be worried about their jobs, which is fine —keeping in mind that managers will be bound by confidentiality and may not be able to share any information. A good manager will want to effectively communicate the financial stability of the organization without breaching confidentiality or telegraphing possible decisions.
Layoffs are not a sign that a company is failing. Reductions in force are just one part of the talent lifecycle —bringing people in, developing people, and transitioning people out. This means that employees should always be prepared for the unexpected by keeping their resumes current, being able to clearly articulate the value they bring to an organization, and taking continual steps toward professional development opportunities that enhance value to a current—or future—employer.
While a layoff does not always spell organizational trouble, everyone should be aware of how marketable they are. Be prepared: cultivate professional networks, have a current resume, and have financial resources available should a job search become necessary. Balance the reality of any layoff with preparation and mindfulness of the status of the business.