What to Do After a Layoff
A layoff is a momentously life-changing event for anyone, but it doesn't have to be a disaster. Being forced to reassess your ultimate career goals can be an opportunity in disguise: as long as you get certain things in place and forge ahead, you might find yourself with a new life you never even knew was in store.
Let's say the bomb has just hit.
It is likely that management will ask you to leave the very day they deliver the bad news that your position has been terminated, and this may feel like a betrayal. It is perfectly normal to feel angry and hurt and to gather sympathy from your family and friends—for a couple days. Beyond that, self-pity will be a handicap in embarking on your new life.
As you turn your attention to the work involved in not working, you will have to draw on your emotional resilience. Emotional resilience is what enables you to adapt to a major setback such as a layoff. While it doesn't mean you won't experience negative emotions, being able to roll with the punches will separate you from many other job-seekers who let stress get the better of them.
Before you make your job search your new full-time job, having some things in place will give you the peace of mind to put your best foot forward.
File for unemployment.
Even if you are offered some severance pay by your company, you will need to file for unemployment if this runs out before you land a new job. In most states, you can file for unemployment online or over the phone, without having to visit the unemployment office in person.
Although unemployment payments vary, the amount on your check will represent a percentage of your income up to a cut-off amount determined by your state (usually $400-$450 per week). With the new stimulus package, you will not pay taxes on the first $2,400 you receive in unemployment.
The number of weeks you are able to collect unemployment also depends on your home state, but with unemployment at crisis highs throughout the country, states have been offering extensions.
Ensure you are covered for healthcare.
If you are healthy and others aren't dependent on you for their own healthcare, it may be tempting to let this major expense fall by the wayside.
Coverage under the Consolidated Omnibus Budget Reconciliation Act (COBRA) will run you about $1,200 a month, though the stimulus plan offers a 65% subsidy for the initial nine months. With a little bit of research, you may find comparable coverage with another insurance company that better fits your budget.
At the very least, go with an inexpensive, no-frills plan which may carry a very high deductible but will keep a serious illness or accident from ruining you financially.
Revise your budget.
Assess how much you have each month after basics such as mortgage, food, utilities, and emergency funds. Vacations may have to become staycations, fancy gym memberships can be booted for jogs outside, cable packages may be scaled back by a couple hundred channels, and you may find yourself on a new culinary kick as you realize how much you save cooking for yourself rather than going out. But you will likely find that these sacrifices are minor now that you have more time and don't have to be paying extra for convenience.
If you have a spouse with steady income, you might consider taking out a home equity line of credit that can be used in case of emergency while you tap into your savings or other taxable accounts that can be liquidated. Do not touch your retirement account except as a last resort, as this could cost you up to 40 cents on the dollar of what you've worked so hard to build up.
Jump back into the job market.
Wake up in the morning each day just as if you were going to work. Get online and check the newspaper for new job listings each and every day—losing even one day can put other applicants at an advantage as employers are inundated with applications. Take the time to tailor each cover letter (and even your resume) to the specific job opportunity at hand, using the same keywords you saw in the job listing. Find the name of the person to whom your letter should be addressed and proofread your applications meticulously: your attention to detail will put you a cut above.
This is also the time to network, network, network. You have spent your entire work life building relationships, so reach out to any colleagues, clients, or vendors you've worked with to let them know that you're on the market. Connect to them on professional networking sites such as LinkedIn, along with all of your friends, and talk to them about the different opportunities you may be interested in.
In the meantime, take good care of yourself—and others. See your extra time as an opportunity to form good habits, which we often neglect in busier phases of our lives. Physical exercise has been proven to relieve stress, and eating well makes us feel better from the inside out.
Finally, you may find that volunteering more of your time in your community is just what you need to keep your perspective during a difficult time. Giving back is not only a great way to bolster your own emotional resilience, it is an avenue toward rebuilding our community as a whole and, hopefully, leaving the current crisis behind.
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