How To Protect Your Employment Before A Lay Off Looms

September 2003


Randall Scasny

More than a hundred years ago, in 1882, the first Labor Day was celebrated as a "national tribute to the contributions workers have made to the strength, prosperity, and well-being" of the United States.

Today, I think most of us still believe in the spirit of the holiday even though we tend to associate it with the last, big outdoor barbecue of the summer, the opening of the professional football season, or the time to send the kids off to school.

In private industry, this is the time of year when companies take actions to put their bottom lines in order to maximize their year-end profits.

According to Challenger, Gray and Christmas Inc., a Chicago-based outplacement firm, Labor Day signals the time when companies begin the lay off season. Recently, the company released a report that said, "Employers typically cut thousands more jobs during the last four months of the year than in the summer or early winter months, and this year should be no different."


I can't think of anything more challenging, besides finding a job in the first place, than thinking about what to do if you are laid off.

A "voluntary" lay off--quitting your job--generally presumes you have another one lined up to go to. But a forced lay off, which for most people means not a job furlough but a permanent job-divorce, can leave job-holders "high and dry" if they don't take some action to protect their employment before the lay off occurs.

Beyond new military retirees, recently laid off vets--those folks who made their career transition years ago--are my most frequent email correspondents as a result of this monthly column.

What kind of advice should I give them?

Should I say, "Everything will be just fine. Everything will be alright," as Emo-rock band Jimmy Eat World sings in their hit song "The Middle," which I hear over and over and over again on my car radio here in Chicago.

Well, I'm not going to bless you with that kind of advice.

I guess that kind of advice is fine for a teenager struggling with the trials of adolescence (the target audience of the song). But for an adult with family responsibilities, a lay off sings a more somber tune, closer to Fleetwood Mac's classic song "Landslide." ("I've been afraid of changing because I've built my life around you.")

Indeed, when a job-holder has worked at a place for a long time, getting laid off is more than just losing a job; it affects every facet of a job-holder's life and anyone who is important to him or her. It's a life-changing, defining event.

The best advice I can give you to protect your employment when a lay off is hanging over your head is: Become aware of what's going on at your job while you have a job.

It sounds like an overly simplistic prescription. But it's sound medicine nonetheless in these times when companies restructure their operations incessantly and lay offs happen so often that they are now the norm instead of the exception.

How does one implement my advice?

If lay-off rumors are spinning in your employees' cafeteria, get to work and determine their validity. If they are true, you must take action whether you like it or not. Procrastination will only make your employment issues more difficult in short order.

Job-holders can protect themselves by assessing their employment situation regularly. Ask yourself these questions:

  • Are you happy at your job? with your boss?
  • Do you feel secure at your job?
  • What's the company or department turnover? (Hint: Are people staying or leaving their jobs in small or great numbers? And, why?)
  • Is your company meeting its business objectives? (Is it making money? No money?)

If most of your answers are "no," start finding out why. If what you find out is good news, stay the course and you'll be okay.

If what you find out doesn't sound promising, it may be time to begin putting your personal budget in order, and, in the worst cases, begin looking for another job while you still have one.


We've come a long way since Upton Sinclair and John Steinbeck wrote about the uncomplimentary work-related issues of the early twentieth century, several generations after the first Labor Day was celebrated.

Nowadays, I don't think any company wants to lay off their employees. Most companies would like to keep and develop them because it costs too much to find qualified people who really know how to do the work and really want to work.

But unlike the U.S. military which has a fair amount of fiscal and staffing stability thanks to the long-range planning of Pentagon logistics wonks and the deep pockets of the U.S. Congress, most private companies' staffing levels are variable, and are determined by a very short-term measure--the quarterly economic report, which, by the way, Wall Street watches like a hawk!

If the reports are fantastic and Wall Street loves the company, expect employers to go on a hiring binge.

On the other hand, if the reports are less than optimistic, companies either (1) extend the working hours of the employees they already have to avoid hiring; (2) they contract with staffing agencies to hire temporary personnel to postpone hiring full-time employees; or, (3) they lay off employees to return to a staffing level that matches demand.

Folks, this is the Age of Labor we live in, I'm afraid to say. Cradle-to-death employment rarely exists anymore. And there are many reasons why.

We live at a time when most new jobs are created by smaller, cash-starved organizations (rather than large mega-corporations) that compete against other (big and small) companies anywhere on the face of the Earth due to the most recent chapter in the history of market globalization.

Globalization is not a new phenomenon.

About the time of the first Labor Day, at the beginning of the industrial revolution, the first factory workers faced the same employment uncertainties as high tech workers have today.

But the solution to these uncertainties a hundred years ago was quite different than it is today.

To deal with the uncertainties produced by globalization back then, labor protectionism through worker unions and trade tariffs was the answer.

Today, the protectionist solution has not been popular because (1) its supporters say protectionism would defeat the advantages of globalization (forging new markets and developing billions of new customers) and (2) our social and political leaders tend to support a pro-business philosophy with globalization as one of its central tenets.

They believe that by eliminating barriers to trade--the essence of globalization today--the costs of products and services will be decreased and, ultimately, these results will increase trade so much that many new jobs will be created. Are they right? I think only history will give us the final answer.

But to date, the advantages of globalization has gone both ways. Trade is up and prices are down. But the global automotive industry, for instance, is struggling with the headaches of entering into the virgin markets of Asia: overcapacity, price wars and a market that can turn from boom to bust in a snap and can send shock waves over the world's economies.

Sound confusing? Well, it is.

That's why in today's "unprotected" business world, you have to become more aware of what's going on and create a contingency plan for yourself. And it all starts with your personal employment assessment.

Employment assessment protects you by making you more aware of how well your company is laboring: is it healthy or not-so-healthy.

If it's healthy, no problem! If it isn't, you must make plans for any missile-hazards that accompany rough seas.

Those plans might simply include cutting your personal budget costs, paying down or getting rid of your credit card debt or saving a bit more for a rainy day--to get you through the rough seas of a looming lay off.

It might also mean diversifying your income by getting a part-time job or starting a home-based business.

It could also mean transferring to a more profitable department within the company you already work for.

This may mean going back to night school or enrolling in an online, distance-learning program to improve your skills. Some effort will be required here. You may not want to do it. You might even be upset at the suggestion. Despite your feelings, in the long run, any steps you actively take to protect your employment will pay off immensely.

There are a number of ways to take the temperature of your company's health. For example:

  • Publicly-held companies: These companies are the easiest to obtain financial information on. Any business newspaper or website can give you info about them. Their stock price is another good barometer for determining what a lot of people (thousands of investors) think about the company. Is it up or down?

    If possible, go to all company-wide meetings. Listen, and ask questions, if invited. Compare what your company's managers are saying to what is being written in the newspapers.

    Perhaps the best way to understand your company's health is looking at how it is managed. Successful managers lead, follow, then step back. This means they take the first step and demonstrate what they are trying to do. Then they follow by listening to employees who have good ideas. Finally, they delegate jobs and let good workers do their job.

  • Privately-held companies: These companies are not required to file a lot of financial information to the public. But many of these companies are written about in the local newspapers. Go to all company-wide meetings. Try to understand how they are doing, that is, are they thriving or not? Watch out for changes in benefits, product lines and changes in infrastructure (buildings and equipment). These things give implicit information about the company's financial health.
  • Family-owned company: Generally, family-owned companies are managed like families. And families tend to be private about their affairs. So, changes in their management style will give telltale information about their financial health.

    If the management starts behaving differently, you may want to "bookmark" this information for future reference. Once again, go to all company-wide meetings. Listen to what they have to say. If invited, ask questions politely. Then go to the Internet or newspapers and find out what everyone else is thinking or saying about the company.

  • Job shops: These are small, service shops that employ a few craftsmen who do specialized tasks for large organizations. A lot of machining, mechanical, electrical and electronic shops fit into this category. You won't find any information on them in the public; few of them are written about in newspapers or magazines. But since they are so small, just listening to the chatter and seeing the workflow will give you a bird's eye view of what is going on.
  • Start-up companies: These companies were the darlings of the 1990s tech boom. They were real companies in name and by law but many were not companies in the sense that is generally accepted--most had few if any customers. How did they make ends meet? Their investors financed the show.

    When you work for a start up, you have to know what you are getting into. The investors surely understand. They know their investment is risky. But a successful start up can be a highly attractive investment as a new product brand, or a buy-out from a company like Microsoft ...

    If the start up isn't doing well, your job depends on how long the investors believe in the management team and the company's idea. If they are still true believers, they will continue to pony up the cash.

    You can find information about these companies on the Internet. But the biggest sign to watch for is: (1) a frequent change in management and (2) the customer accounts. If something isn't working, people get moved around until they do. If they aren't increasing their customer accounts, they will need another round of investment to survive. Both of these things are directly connected to your job security.


Protecting your employment in your post-military career requires a lot more knowledge and effort about the circumstances of your job than you needed working for Uncle Sam. That's why a lot of vets who write me are interested in federal employment, which generally has more job security and, for some jobs, competitive salaries. If you are qualified, and are willing to put in the big effort to win a Federal job, go for it!

But if you are already working in the private sector, to protect yourself from the changing conditions your company or industry, you must look, listen and become aware of its circumstances.

Get in the habit of planning your employment in 5-year blocks. Normally, if you can stay employed in an industry over that length of time, you will have developed the contacts, knowledge and experience to move about the industry easily and get re-employed quickly.

In the end, you must make a decision whether to stay or leave your job. No one will blame you if you must leave to ensure financial security for your family. Doing it before you get the pink slip will give you more control over your life and career than waiting till after the fact.

Happy Labor Day!

Good luck in your job search.

All opinions, advice, statements or other information expressed in this article are solely the author's and do not necessarily express the opinions of or the publisher.

Copyright 2003 Randall Scasny. All rights reserved. This material may not be published, rewritten, or redistributed.