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Why You Got Laid Off – Not for the Reasons You Think

WorkCoachCafeWhy ME?

You were laid off, and what keeps running through your mind is “Why me?”

Wrong – but very common – assumptions about being laid off:

  1. Don’t assume that YOU did anything “wrong.”  Chances are very slim that your layoff really had anything to do with you, personally – with your skills, your work ethic, or how well you were liked in the organization.  Just not very likely.
  2. Don’t assume that the reason you were chosen was rational, at least not the way you think it was.  It is very rare for management to go through the list of employees, choosing to retain the best contributors and select the poorest performers to lay off.  It’s logical for them to do that, but it seldom happens. (If they were that smart, would there be a need for layoffs?)

Who leaves and who stays is often irrational.  I’ve been through several rounds of layoffs at a high tech company, and I’ve seen first hand how it works (and doesn’t work).  Excellent people, known internally to be the “go-to experts” on important things, are laid off while “deadwood” is retained.  For an organization that is trying to survive, it’s crazy.  But common.

Why you -

Most of the time, the reason you were laid off is just plain bad luck.  Seriously!

You were in the wrong job group (admin, marketing, engineering, etc.) and/or in the wrong part of the organization (manufacturing, shipping, support, etc), when management decided that expenses needed to be cut.

The job group/organization you were in was chosen to contribute to cutting expenses. That’s the most “rational” part of the process – and it is often irrational, too.  I can’t tell you how many times I’ve seen a struggling company cut their sales force first.  Eh?

Why layoffs?

In my observation and experience, the reason for layoffs is usually a management failure. Top management is human, too, and we all make mistakes.  The company “zigs,” but the market has “zagged” (think Kodak).  Or management bets it all on a new technology that fails.  Or the company is sold to a competitor that doesn’t need two of everyone (from finance to sales to shipping).  Or a million other things happen.

What makes layoffs such a popular “solution” is based on two things:

  1. The cost of the employees is often the biggest cost for an organization.
    In addition to the salaries, the cost of benefits, payroll taxes, and other expenses associated with employees, typically add another 35% above the base salaries to the costs.  Consequently, if an organization wants a “quick fix” to its profitability problem, reducing this big expense is an obvious way to do it.
  2. Employees are in a category called “fixed costs” – costs that don’t change regardless of the level of work being done.
    This means that if the organization’s revenue has dropped, the fixed cost of employees is higher in comparison to revenue, reducing profit.  Again, if an organization needs to improve profitability quickly, employee expenses are a juicy target.

So, when an organization needs to cut expenses, reducing the number of employees has a big impact.  And, in the USA, it’s relatively quick and easy to do, so the improvement on the “bottom line” happens swiftly.

Some very successful companies have a policy of no layoffs.  Southwest Airlines comes to mind.  So, consider that when you are shopping for your next employer.

Do NOT confuse being laid off with being fired!

Fired for cause:

If someone is fired, it is because someone in the organization’s management determined that they had a reason, usually labeled a “cause,” to require the employee’s termination.

Management discovered that an employee was doing something the employee shouldn’t have been doing, the employee was a poor performer – not doing their job well enough to keep it, or the manager doesn’t want to keep that employee for some other reason.

So, the work is still needed, but that one particular employee is not needed.

Laid off because the work is gone:

Here is the easiest example for most of us to understand – many members of the cast and crew of a TV show lose their jobs when the show is canceled.  The work is no longer needed (canceled show), so the employees are no longer needed (laid off).  Some are lucky enough to have permanent jobs with the production organization, but not the majority.

In other organizations, perhaps only one person in a department is laid off because only one person’s work went away.  More often, the work of many people disappears.  They were doing fine at their jobs, perhaps they were even “excellent workers.”  But the work is no longer needed by the organization.

In a layoff, the workers are not “at fault” in these situations, although they may feel like it. Their jobs are simply gone.

How do layoffs happen?

If you have ever been through a layoff, you know that very irrational things happen because, as one HR person described the process, the staff reduction is done with an ax rather than a scalpel.  

Layoffs are very seldom done carefully.  Who stays and who leaves is not painstakingly analyzed.  Very few organizations have the time to use a layoff as a chance to weed out the “poor performers.”  Usually, layoffs are done hastily once the decision has been made to improve the financial results or forecast as quickly as possible.

Thus, the “higher ups” decide to cut expenses, so:

  • One department reduces their people expenses, by 10%, (or whatever).  OR…
  • Several departments reduce their people expenses, by 10%, (or whatever).  OR…
  • The whole organization reduces their people expenses, by 10%, (or whatever).
Then, a decision is made for the basis of the cuts, and the decision is very seldom made on the performance of the individuals, or even on their overall value to the organization.  More often, the people selected to be cut are:
  • The highest-paid employees because removing a few of them will have a big impact.
  • The longest term employees because they typically are the most highly paid.
  • The newest employees because when things “get better” they will be the easiest to replace.
  • The people in a specific group and/or in a specific function which is no longer seen as contributing enough to be retained at the current level.

So,  it’s really NOT YOU, personally!

Now what?

It is difficult, but move on.  Sign up for unemployment compensation, in the USA.  Shed the anger (justifiable, but often making you a less-effective job seeker), and consider your options.

Whenever I’ve been laid off (twice), I’ve read the latest edition of “What Color Is Your Parachute?” an excellent book for determining what you might want to do – and would do successfully – next.  If your library has only one “career” book, that’s the one they have.

Then:

  • Put together a good answer to the question about why you left your last job (no dumping on that last employer),
  • Polish your resume and your LinkedIn Profile,
  • Determine where you want to work next (have a list of 10 to 20 potential employers), and
  • Start hunting for that next great job.

You have nothing to apologize for or be ashamed of!

More About Recovering from a Layoff

Guide to Layoffs and Layoff Survival (Job-Hunt.org)

Guide to Job Loss Recovery (Job-Hunt.org)

 

© Copyright, 2012, Susan P. Joyce. All rights reserved.

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About the author…

Online job search expert Susan P. Joyce has been  observing the online job search world and teaching online job search skills since 1995. Susan is a two-time layoff “graduate” who has worked in human resources at Harvard University and in a compensation consulting firm. In 2011, NETability purchased WorkCoachCafe.com, which Susan has been editor and publisher of WorkCoach since then.  Susan also edits and publishes Job-Hunt.org.  Follow Susan on Twitter at @jobhuntorg and on .

Comments

  1. Denise G. says:

    Thanks, Susan. I can’t be reminded of this sort of thing enough. I’ve been laid off 3 times over the years. The first 2 situations were pretty straightforward and understandable. This current one has been the most difficult.

    • Hi Denise,

      I think recovering from your most recent layoff would have been much easier for you if the economy had been in better shape. Hopefully, you have now used up all of your bad luck, and it won’t happen to you again.

      I must admit that the reason I started my own business in 1995 was because I didn’t want to be laid off again. And, I wanted to choose who I worked with, set my own priorities and direction, and work on what pleased and interested me. It has been a BIG learning experience, but for me it has worked out. So far…

      I don’t think any of us give enough credit to just plain “luck” or “being blessed” or whatever you want to call it.

      You definitely have the right attitude – you WILL survive this!

      Good luck!
      Susan

  2. I’m on a layoff a the moment. I’ve been there fifteen years. I can work everywhere in the place and also have 2 job titles. When one job is slow I work the other sometimes I do both in the same day and meet my expectations 98% of the time. But because of three jealous people, 1 on the floor and 2 in HR, wich the one is a friend and a suckass. I get the layoff.

    I have accomplished more in 15 years then the 1 has done in 19 but because of the ass kissing and friendship, he can back stab me, wich I ignore but it always backfires on me.

    When I ask HR why was I on the layoff list? His responce is always, ” why should you be more special then the rest your just a worker…”

    What do you do with this situation?

  3. In the last 20 years, I’ve been through 1 potential lay off which resulted in me getting a job due to my ‘workforce reduction status.’ The company was adamant that that employee receive priority. The second — same scenario–except there were no openings so I got laid off–the third–at Will policy, company abused it,–the fourth, ‘wfr’ but even though we were to be considered priority the hiring managers would select people who already had jobs. When I asked one manager if there was something I needed to improve on my success, he just said i had excellent qualifications and references. It was a tough decision…uh…not really…your individual already had a job….I didn’t.

    At first I was mad at the recruiters and later found out they’re just as frustrated because the manager is the final decision maker–even though the recruiter knows you’re the top candidate.

    I do get tired of friends saying “it was meant to be” “God has a plan for you” etc…yes, easy for them to say while they still have their nice cars and homes…and of coure they’ve never been laid off.

    It’s easier said than done–but you just need to go forward–or make yourself sick.

  4. I worked at a company that was taken over by a larger company. Every time I turned around it was another layoff. They also were hiring people. I went in the fourth wave. Anyway the company talked about how they were growing and adding business. They’d hire maybe 10 people and after they were trained they’d layoff some of the more senior employees. I had been in the office the longest. In the wave I was let go in they had recently hired a team of about 10 people. Then they decided to let 5 people go–I was one of them. There were four women and one man. I really believe the man was let go because they were afraid of gender discrimination. Before we left people were concerned because we did the work. Some of the people left behind did not work that hard. There were good people let go and not-so-good people who remained. They never laid off anyone that was hired after the new company took over–just those who remained from the company that was taken over.

    • Susan P. Joyce says:

      Hi Gale,

      I saw it in the rounds of layoffs that I went through. Who is laid off has less to do with competence and more to do with budgets and/or politics. Good workers were let go. “Face time” people, who didn’t do much work, were kept.

      Good luck with your job search!
      Susan

  5. Thank you for this article. I’ve just been laid off from a positioned I loved, doing work I was passionate about. While the director of the school I worked for has agreed to be a reference it’s hard not to wonder “why me” and go through every mistake I ever made and wonder if that’s what did it.

  6. M. Williams says:

    WHY ME?
    I was one of the highest producers of manufacturing, never called in sick, Veteran USN, highest trained in other departments and feel that I am the most honest person they could have on the work force.
    Was it because I took a medical leave for a month anxiety due to a supervisor cursing me out for no reason? Seems to be the MO for this company……..

    • Susan P. Joyce says:

      Sorry, you will probably never know why you were fired, which makes it more difficult.

      It sounds like you have excellent accomplishments to include in your social profiles, like LinkedIn and Google Pus, and your resume.

      Do what you can to dump out the anger so that it doesn’t sabotage your future.

      Good luck with your job search!
      Susan

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