How to prepare for the worst as global giants cut jobs
By Charlie Wells
Amazon is starting the biggest round of job cuts in its history. Microsoft plans to reduce its workforce by 5 per cent. Salesforce said it will axe a tenth of its staff. And it’s not just the global tech giants looking to tighten their belts.
The frenzied, pandemic-era burst of hiring across high-wage industries has ended. In its wake, firms are seeking to cut costs — and staff — in anticipation of a downturn.
“We’re seeing the pendulum switch,” said Jacob Zabkowicz, a vice president and general manager at recruiter Korn Ferry. “The power balance is moving back to the employer.”
Here’s what experts say you should do if you find yourself stuck at a company where layoffs loom, bonuses are down, or anxiety is up:
Go ahead and do it: Ask your boss if you’re going to be laid off.
One of the most disturbing trends of the past few months of layoffs has been the tendency for some companies to miscommunicate with staff about who is losing their job and when. Some employees have found out about their terminations via social media, or because they lost access to internal systems like Slack.
In a context where there is a lot of confusion and the rumour mill runs rife, career experts say it can be helpful to ask your boss about your job status, as long as you do it constructively and frame it in a positive way.
“It’s completely appropriate to go to your boss and just say, ‘Hey, I’d like to talk about my career development here. I have some ideas about ways I’d like to grow, and I would love your feedback,’” said Michael Urtuzuástegui Melcher, an executive coach in New York and author of the forthcoming book, Your Invisible Network.
Melcher notes that companies are often looking for underperformers during job culls. Given this harsh truth, it’s important for staff facing potential layoffs not to be high maintenance, not to put targets on their backs, and to indicate their desire to stay at the company, he said. Having a conversation about career development both indicates your intent to stay, and might provide insights on the status of your job.
The hunt
Maybe a cull hasn’t happened yet, but you have an inkling of cuts to come. Experts say looking for a new job would be a smart move, as long as you avoid some common pitfalls. The biggest one? Lying.
“Your job is one of the most important relationships that you have in your life,” said Bill Driscoll, a senior district president in Boston for recruiter Robert Half. “So you certainly don’t want to get into it under false pretence in any way, shape or form.”
That means being transparent about your story as you search for a new role. If you work at a high-profile company whose staffing reductions have made headlines, you’ll want to be honest about that, said Driscoll. What’s more, a new firm might actually see your layoff as an asset because they’re effectively hiring you away from a competitor.
Monique Valcour, an executive coach, said it’s a similar story with networking during a distressed time at your current employer. The beginning of the year is a great excuse to get in touch with people who may not be hiring but who might know others who are. And addressing your potential job loss instead of hiding it could help you have a more frank conversation.
“’You can say, ‘I’m working on such-and-such at Meta and I find it really fascinating. But, you know, there’s some talk right now that there may be layoffs coming,’” she said of a hypothetical networking conversation.
Bad bonuses
So you get to keep your job… but your bonus is down or out of the picture. That’s a common scenario for many employees in sectors where layoffs are happening at some but not all firms.
A diminished bonus can be a sign of impending trouble for your career prospects at your current firm, according to Tyler Whitehouse, director of financial planning at RMR Wealth Builders in Montclair, New Jersey, whose clients include many Wall Street employees. That’s why he says it pays to have contingency plans that account for years with much less or even no income.
Whitehouse is currently working with a client in his 30s who makes around $US2 million ($2.9 million) a year on Wall Street, including a bonus. To prepare for the possibility that his client’s income drops to zero, they crafted a laddered portfolio of US Treasuries outside his regular investment accounts. The ladder means different sets of these bonds come due each month, allowing his client to use the money to cover expenses if his income drops, or reinvest it if he keeps his job.
Bloomberg
The Business Briefing newsletter delivers major stories, exclusive coverage and expert opinion. Sign up to get it every weekday morning.
Most Viewed in Business
Source: Thanks smh.com