How to Protect Yourself If You Fear Being Downsized

Understand the Mentality Behind Cutbacks, Layoffs, and Downsizing

From an employee’s perspective, facing monetary or personnel cutbacks is terrible and can affect more than just workplace relations. The feelings of fear, worry, and uncertainty often carry over to one’s personal life.

Much of the problem stems from the overbearing uncertainty that surrounds the potential for negative company changes. But, employees should also understand the executive management mentality that generates cutback, layoff, and downsizing discussions in the conference room.

Senior management shoulders responsibility for the entire company. Decisions that work wonderfully in booming economies can spell instant or lingering death for organizations during recessions. While it’s true that many management teams retreat to the “corporate bunker” during these stressful times, more seasoned teams analyze every company operation and department to find ways to save money and survive.

A lack of customer orders or sales immediately reduces income and cash flow. Although some organizations far over-use their “red pencil” to eliminate expenses, on paper, cutting personnel makes immediate sense. Just look at your employer’s income statement. In most cases, the largest expense category—which will quickly jump at your eyes—is compensation and benefits.

Unfortunately, shaving most other major expenses, on paper, is much more difficult than reducing compensation. Even the newest manager realizes it’s not easy to eliminate people, but erasing “compensation” is much more impersonal and the numbers are significant. However, this mentality also makes sense on some levels. Fewer customers and sales typically require fewer employees, who are paid regardless of company cash flow.

This mentality is perfectly understandable and based on the primary responsibility of executive management to help the company survive and prosper, at the expense of all other considerations. This mentality, however personally damaging to individual employees, takes hold in almost every company. Accept this reality and take steps to protect yourself.

Action Plans to Protect Yourself When You Fear for Your Job

Don’t wait for events, over which you have little or no control, take place. Unless you have the magic potion to create customers and sales when they, like you, have fewer dollars to spend, accept the fact that downsizing may occur. Plan your work and work your plan to survive these potholes in the highway of your career.

• Stop worrying about the future. Worrying is counterproductive in all cases. Even if you have some control over future workplace events, worry will not improve the conditions or your performance. It may make a bad situation worse, but it won’t help.

• Disregard rumors and gossip. Only deal in truth and facts. Typically, during these periods, disaster rumors abound. Few, if any are based on fact. Disregard all negative rumors and whining in the workplace. They will not help you and often never come to reality.

• Update your resume or CV. Don’t wait. Do it now even if you’re simply projecting a possible downsizing event at your employer. Be prepared. You must eliminate your loyalty feelings and understand that it’s not personal; it’s just business.

• Strongly reactivate your contact network. Ask everyone you know, personally and professionally, about job opportunities of which they may be aware at their companies or others. Contact Human Resource (HR) managers and the best employment search firms, like Kelly Services, and simply ask if it’s wise to submit your resume.

• Get references from superiors BEFORE you leave. Ask for references in case you need them. Should the company admit there might be cutbacks, you are dealing from strength by asking for glowing references before the downsizing occurs. Should no cuts occur, you’re still in a positive position.

• Ask HR what settlement or exit packages are available. You must always know your rights as opposed to your privileges. Should you be laid off or downsized, you must be prepared to exercise your rights to receive all exit packages to which you’re entitled. Ask now how much compensation you can receive, what benefits will be continued, and what are the probabilities of rehire when the economy recovers.

These action plans accomplish three goals. You position yourself with contacts and top search firms to learn of lucrative job opportunities should you need them. Learning about the compensation and benefits due should you be downsized, you can build a worst case personal budget to carry you over the short-term. Most importantly, you generate confidence in your ability to survive and prosper should the worst happen.

This confidence can make a critical difference on how you approach the possibility of downsizing. Just as a positive outlook helps athletes, those facing serious diseases, and students facing difficult examinations, using these action plans prepares you, both physically and mentally, to face whatever challenges a deep recession offers you and your company.