Losing your job can feel like the ground has been ripped out from under you. One day you're settled into your routine, and the next you're joining the ranks of the unemployed through no fault of your own. Company downsizing, budget cuts, restructuring - there are so many factors beyond your control that can lead to a layoff.
As painful as it is in the moment, a layoff can actually be an amazing opportunity for something new and better to blossom in your life and career. Sure, it's scary to have that steady paycheck disappear. But this shakeup can be the kick in the pants you need to re-evaluate your goals and find meaningful work that truly lights you up.
Think of it this way - the second you get that fateful call or meeting, the door opens wide for you to walk through to greener pastures. You get to re-invent yourself, switch gears, chase down that long-deferred dream career. With a bit of moxie and persistence, this seeming setback could propel you forward in ways you never imagined.
With that said, here’s what you need to know about being laid off and what to do next.
What does it mean to be laid off?
Being laid off means you have lost your job because your employer is facing financial constraints and can no longer afford to pay you or no longer needs your services. However, unlike being fired, you are not losing your job due to any fault of your own. Therefore, it's important to understand that being laid off is not the same as being fired.
When you’re fired, you usually lose your job because of your performance or larger issues like insubordination or absenteeism.
A company might need to lay off employees because they’re restructuring, shifting markets, or handling economic factors like a recession. Regardless of the circumstances behind your layoff, you may be entitled to compensation such as unemployment benefits, healthcare subsidies, and a severance package.
Should these circumstances change, your old employer may offer you your job back, but they’re not legally required to.
What to ask your employer when you’re laid off
To ensure you gain as many layoff benefits as possible and set yourself up for success moving forward, ask your employer these questions:
- When can I expect to receive my last paycheck?
- Will I be compensated for my unused paid time off or sick leave?
- Can I expect severance pay?
- What will happen to my 401(k) / pension plan?
- Will I have health insurance coverage after my last day of work?
- Will you provide a reference for me?
- Can I have copies of my performance reviews?
- How long do I have to access projects I’m working on (like a portfolio)?
What to do when you’re laid off
After losing your job, what you do next determines how quickly you’re back on your feet and loving a new role. Here are your next steps:
1. Know your rights
The first thing to remember is that you have rights as an employee during a layoff. Review your employment contract or handbook to see if it mentions a severance package and layoff benefits.
And don’t sign anything, like a termination agreement or layoff letter, until you’ve had a chance to review the terms of your separation. If something feels off, consult an employment lawyer to ensure everything’s legal.
2. Get it in writing
Ask HR to provide a letter confirming for future employers that you lost your job for reasons outside your control. These letters often include details about your accomplishments and contributions, so review them for errors or omissions.
3. Ask about a severance package
While companies aren’t legally required to provide severance, they may still offer to compensate you through a payout or other benefits, including unused vacation time or paid sick leave.
The longer you’ve been with a company, the more benefits you may receive. If you don’t feel the package is adequate, you can attempt to negotiate better terms.
4. Review your retirement plan
Whether you enrolled in your employer’s 401(k) or another pension program, review the plan’s terms to see what your options are. You might be able to leave these funds where they are for a certain amount of time or move them immediately to a personal retirement account.
Consult a financial advisor to determine the best move.
5. Secure healthcare coverage
If your employer supplied health insurance as part of your benefits package, you could choose to remain on the plan temporarily through COBRA continuation coverage. If not, you can apply for coverage from a private insurer or a government health care provider.
Losing coverage because of a layoff counts as a qualifying life event, meaning you can enroll in health insurance outside the typical enrollment period. This also means you might be able to join your spouse’s coverage.
6. Determine the details of your final paycheck
Depending on your termination agreement, you may receive your final pay immediately. Double-check the amount and deductions for any errors. If you’re part of a mass layoff subject to the WARN Act, you may be entitled to 60 days’ notice before termination.
During this period, the employer must continue to pay your wages and benefits, giving you some financial cushioning while job hunting.
7. Request a letter of recommendation
While ties are still strong, ask for a reference letter from your manager to give potential employers an accurate profile of your employee strengths, transferable skills, and performance.
8. File for unemployment benefits
While requirements vary between states, you may qualify for unemployment benefits. Receiving them takes time, so inquire about these benefits as soon as possible to avoid long breaks in income.
9. Adjust your budget
To try and maintain financial wellness throughout this transition, take stock of your personal finances to gain an accurate picture of all necessary expenses and non-essential items. Then, create a budget that should keep you afloat between jobs.
10. Set attainable goals
Instead of just grinding through job applications, set fun, energizing goals each day. Whether it's reaching out to three new networking contacts who can open doors or watching a tutorial to pick up an impressive new skill - small, rewarding steps will propel you forward.
11. Remind yourself of the good
While the job search hustle is important, don't neglect your mental and emotional well-being. Keeping a gratitude journal where you jot down a few things you're thankful for - from nature's beauty to supportive loved ones - can be so grounding. It's about appreciating the goodness that still surrounds you.
12. Revisit or discover new hobbies
With a little more free time at your fingertips, rediscover those passions and hobbies you once loved. Dust off that guitar, pick up your paintbrushes or join a recreational sports team. You could even knock an item or two off of your bucket list. Reigniting your creative sparks is incredibly therapeutic.
13. Upskill yourself
Remember to keep yourself fresh and employable. Check out webinars in your field, online courses to buff up skills, or attend professional meetup events (in-person or virtual). Staying engaged and expanding your knowledge is power.
14. Seek support from your network
If you're feeling totally adrift or self-doubting, don't be afraid to bring in guides and mentors. A career coach can be an amazing thought partner for strategic job hunting. And if the blues are hitting hard, speaking to a mental health professional can help. They're experts at helping reframe this transition positively.
15. Consider where you really want to go next
While you're putting in the work, be sure to visualize that exciting next role, career, or path. Create a vision board with details of your dream life, inspiring images, and motivating mantras. It'll keep you laser-focused on your goals.
16. Try different forms of networking
You can also use this "in-between" period to give back through volunteering. It's incredibly fulfilling, allows you to do good for causes you care about, and can provide fantastic networking opportunities.
If you're open to it, join a job club or professional association's sub-group for job seekers. You may make friends, trade insider intel, and motivate others to keep moving forward.
17. Lean into your support system
Most importantly, don't retreat into a shell. Lean on your ride-or-die friends and family for love, laughter, and listening ears during the challenging moments. Having your cheerleaders in your corner is invaluable.
How to take care of yourself when you get laid off
Being laid off can be emotionally draining, and it's easy to get demotivated or burned out during the job search process. Here are some tips to help you stay motivated and avoid burnout:
- Set a routine: Having a daily routine can provide structure and a sense of purpose. Wake up at a consistent time, get dressed, and dedicate set hours for your job search activities.
- Take breaks: Job hunting can be mentally exhausting. Build in breaks throughout the day to recharge. Go for a walk, exercise, or engage in a hobby you enjoy. These mental breaks will help you come back refreshed.
- Celebrate small wins: The job search is filled with rejections, so it's important to celebrate even the smallest achievements. Whether it's getting a response, having a great conversation during an interview, or updating your resume, recognize these wins.
- Connect with others: Isolation can zap your motivation. Schedule regular check-ins with friends, family, a coach or former colleagues.
- Practice self-care: Make time for activities that promote your well-being, such as exercise, meditation, reading, or pursuing a creative outlet. Taking care of yourself will help you stay positive and resilient.
- Learn something new: Engage your mind by taking an online course, attending a webinar, or reading books related to your field or interests. Continuous learning can boost your confidence and make you feel productive.
- Set realistic expectations: Understand that finding a new job takes time. Celebrate small wins, but also be patient and kind to yourself during the process.
- Seek professional help: If you're feeling overwhelmed or struggling with your mental health, don't hesitate to seek support from a coach, therapist, or mental health professional.
6 tips for getting a job after you’ve been laid off
After some self-care and journaling, you’re prepared to begin the ever-daunting job search. Here are a few tips to help you find a new position:
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Update your resume: Include your most recent work experience and any new skills, certifications, or qualifications you acquired with your previous employer. And don’t forget to update your LinkedIn profile — you’ll need it to tap into your professional network and connect with other industry professionals.
If recruiters ask about your previous position, knowing what to say when you get laid off can be challenging. But it’s best to be transparent since this information will likely come to light, and you don’t want a hiring manager questioning your honesty.
- Find upskilling opportunities: Use this limbo period strategically by improving your skills. Choose something that boosts your resume while making you feel better prepared for a new role.
- Start networking: Studies show that 70–85% of job hunters land roles thanks to networking. This includes chatting with loved ones and friends, cold-connecting with ex-coworkers on LinkedIn, and attending events. Do whatever you’re capable of because the more you reach out, the more likely someone will think of you when a great role opens up.
- Create a daily routine: Unemployment can force you out of your routine, making you feel less inspired. Stay motivated to find a new job by sticking to your regular routine as much as possible, be it meal planning, exercise, or mental health habits like meditation.
- Build a vision board: This career break isn’t necessarily bad, as it gives you a moment to reevaluate your priorities. To aid this reflection, try creating a vision board illustrating your goals, putting it somewhere you look every day to remind you of what you’re working toward.
- Schedule your job search: To keep yourself motivated and add purpose and structure to your days, schedule job hunting like you would work. This also means you’re limiting time spent scrolling job boards to enjoy a much-needed mental break and avoid becoming overwhelmed.
Embrace a new chapter after being laid off
When you first lose your job, it’s hard to see the positives. If you were laid off, you may feel shocked or blindsided. Sit with this news for a while, considering what this job loss means for your life. At first, most of these things might be negative. But with time, you’ll see that losing one thing means gaining another.
A layoff is a second chance in disguise. It's an opportunity to reimagine your future and blaze a new trail aligned with who you are today. With resilience, creativity, and a growth mindset, this setback can set you up for a major comeback in a career you're truly passionate about.
So don't be discouraged - embrace the uncertainties ahead as a call for reinvention. Things may look blurry right now, but pretty soon, you'll gain clarity on an even brighter future. One door closed, but another is waiting for you to burst through it.
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