There are companies, even large corporations (e.g. Arthur Andersen, Lehman Brothers) that get in trouble and dissolve very quickly. Others can stay on the edge of disaster for a long time. It is not easy to predict the layoff, but it doesn’t always come unexpected. There are a few things that can indicate the potential trouble.
What’s going on in the company?
Listen what your co-workers say and read public forums (e.g. vault.com) dedicated to your company. Watch for changes in the company policies focusing on saving money, reducing company budgets, travel and hiring freezes, sudden departure of senior management or key employees, outplacement firms getting new business, company seeking a buyer for all or part of the business.
Read the news about your employer.
Is there speculation about low profits, dropping sales, serious problems with products or services, strange senior management behavior?
Is the company for sale or being acquired/merged with another company?
Layoffs may often be triggered by mergers and acquisitions due to the effort of reducing duplicate job functions. The company that is being purchased is usually the one to loose the jobs.
Check if your company falls under the WARN Act requirements.
In the US, certain companies are required to provide 60 days advance notice to the governments and affected staff in case of mass layoffs.
For public companies, check financial reports and stock prices
Financial reports are required by law and published regularly. Keep in mind though that not all reports are audited by outside (independent) accounting firms. Low profits and executives selling most of their shares are bad indicators. Depending on overall market condition, stock prices dropping over extended period of time may also be a bad sign.
There is often no logic about who leaves and who remains after the layoff. It’s more about being in the wrong place (e.g. industry, pay grade, job title, etc.) at the wrong time (e.g. economic crisis). It is very dangerous to believe that it can never happen to you. So, if you see more than one sign of trouble, it maybe the time to start preparing.
I got laid off recently and it was a surprise. I was laid off 5 years ago and it not a surprise. One thing that my old company tried to do was to question one of my expenses. It was a calling card for a whopping $14. I think they were trying to see if the charge was phony. Anything under $15 did not require a receipt so I used to charge up the calling card with $14 charges because I did it over the phone so no receipt was available. I think they were hoping they could prove the charge was phony so they could fire me with no severance. Unfortunately for them the charge was valid and I pulled up my charge card statement and showed a valid charge for $14. I think they were very disappointed. That however was a major clue for me because nobody had ever questioned an expense report before and I used to travel internationally and many expense reports would come close to $10K. So if you are in the habit of padding your expense reports (which I don't) and you suspect a layoff coming with a severance package, be extra careful with those expenses.
ferd dong
Some other indicators (from personal experience):
The company used to tell employees about profits and how business is going, but they've quit doing that.
You notice that strangers in suits are being shown around by upper management, but they don't tell employees when or why.
If you are privy to project management meetings you notice that there is little (if any) new business, and the focus is on how to cut costs and time out of current projects.
The company politics game has stepped up, and suddenly people who are buddies with upper management but never were interested in what you did are now suddenly very interested in what you do.
You notice that inventory is shrinking below normal levels and there is no interest in replacing it. Same for keeping contracts for services.
Management is talking about outsourcing.
You face new restrictions about talking to customers and vendors.
Upper managers and senior technicians find new jobs and leave without spending time to train replacements. Some just seem to disappear overnight.
Management places lots of emphasis on sales and marketing, but no efforts on product support or development (that you'd expect to be needed to service an increase in sales).
Michael N. Chernick
This is timely advice, as corporations often proceed with layoffs just before or after the holidays. A major U.S. telecom company announced yesterday that it will be reducing its workforce by 2500 people in December. Surely there are other businesses, large and small, considering cutbacks in personnel as 2009 draws to a close.
Regardless of reports indicating the recession is over, our economy is still in a fragile state and employees should have a plan 'B' ready to implement if and when the axe falls.
My prediction: After a lackluster holiday season for retailers, unemployment in the U.S. will climb to 11% within a few months.
I hope I'm wrong. We'll find out soon enough.
There are companies, even large corporations (e.g. Arthur Andersen, Lehman Brothers) that get in trouble and dissolve very quickly. Others can stay on the edge of disaster for a long time. It is not easy to predict the layoff, but it doesn’t always come unexpected. There are a few things that can indicate the potential trouble.
