Getting laid off is one of the most serious concerns that most people have in the workplace, especially during times of a slowdown or recession in the general economy. It doesn't matter how long you've worked for a company, there is always the possibility of being laid off.
•Recession
•Economic slowdown or stagnation
•Downsizing
•Company buyout
•High competition
•Mismanagement of assets
•Outsourcing
•Loss of capital
Once a company starts feeling pinched in times of a recession or in the face of other market pressures, management has to look for ways to solidify the bottom line of the company, to keep it competitive in the market, and in some cases, keep from going bankrupt or completely out of business.
Management may see a real need to down size, or may find it cheaper to produce goods overseas. Whatever the scenario, layoffs are always a real possibility.
Sometimes, notification of a layoff may be given well in advance, but sometimes they are totally unexpected. In either case, the employee finds himself out of work and looking for another job. It may not seem real until it happens.
Most companies try to find other ways to keep running by cutting costs in an effort to stop financial stagnation, and use layoffs only as a last resort. But if business declines or remains slow and there is no projected growth in short or long term earnings, then layoffs may be the company's only recourse.
Over time, a company invests vast amount of resources in their employees, from hiring, training, salaries, insurances, and other benefits. Keeping employees working and productive is in the company's best interest, and no company really wants to cut jobs.
Employers know that skilled labor is a valuable commodity and once an employee is laid off, the employee may not return to the company, especially if work is found elsewhere.
The employee with the least seniority is usually the first to get a pink slip or layoff notice, but depending on how deep the recession is, the lay offs may climb to include those with high seniority. That is why unemployment insurance is so important for all employees.
If you get laid off, it can hurt in many ways. Household expenses, car notes, life insurance premiums, credit cards, and other monthly bills may suffer the consequences. Saving may have to be used for financial survival and there is the emotional stress.
During periods of unemployment, many marriages go through turmoil, some ending in divorce. There is the increased likelihood of spousal abuse, child abuse, and drug and alcohol related issues.
On the other hand, there can be some positive gains associated with being laid off, such as finding a better job. Many people go back to school to get their degrees, retrain, and/or to learn other skills.