Protect your money and your career. Prepare for a layoff.
As chatter increases around a potential recession, many Americans are worried about layoffs. Results from a recent CNBC workforce survey found that 80% of workers are concerned about a recession. Those worries could be founded based on a survey from Insight Global which showed that 87% of managers said they would likely lay off employees should the U.S. enter a recession. Other key findings from the survey include:
- 54% would be willing to take a pay cut to avoid a layoff
- 56% don’t feel financially prepared for a recession
- 47% of employees don’t trust their employer to adequately communicate its recession plans
Whether your company can weather a recession or not, it’s never a bad idea to prepare for the unexpected. Here are just some ways you can prepare for a layoff.
1. Start putting more money into your savings.
This first tip is pretty obvious, but it’s also an important step towards preparing for a layoff. Most experts believe you should have 3 to 6 months’ worth of living expenses put away in your emergency fund. If you don’t have much of a savings, now is the time to create or adjust your budget and put more into your emergency fund.
2. Know your rights and your benefits.
Some employers provide severance to employees who are laid off. Check your contract to see if your employer specifies policies around severance. If you’re not sure, you can also check with your company’s HR department. Unemployment benefits vary from state to state, but you can look up your state’s policies online at your state government website. Knowing how much severance you could receive and how much your state pays in terms of unemployment benefits will help you determine how much money you need to put away.
3. Watch your debt.
If you are hearing rumblings of layoffs, now is not the time to start racking up debt. You might want to avoid making major purchases until you have more job security. Watch how much you’re putting on your credit card and make sure you can pay it off each month to avoid interest. If you have a lot of existing debt, prioritize paying it off while you can.
4. Research your health benefits coverage and make doctor appointments.
One important way to prepare for a layoff is to prioritize healthcare and take advantage of your benefits while you have them. Make that eye doctor appointment and get those new glasses. See your primary care doctor and get that annual checkup. Paying for healthcare out of pocket can be extremely expensive. You might be able to stay on your employer’s health plan through COBRA, but expect your premiums to go up.
5. Update your resume and online profiles.
Take the time to update your resume in preparation for a layoff. You will need an updated resume when applying to new jobs. Update online profiles like LinkedIn as well. If you have low job security, you might want to turn on LinkedIn job notifications and let employers know you are open to new opportunities by using the Open to Work feature. Just make sure you set it so that only recruiters can see it and not all LinkedIn members.
While recession talk is in the news, many Americans are worried that layoffs may be on the way. If you are worried about your job security, now is the time to prepare for a layoff. There are many things you can do to prepare, including putting more money towards your emergency fund. Research your unemployment benefits so you know how much you need to put away. Watch your debt and pay some off if you can. Take advantage of your health benefits and see your doctor. Update your resume and online career profiles so you’re ready for the next step in your career.