With layoffs gaining attention at major companies such as Meta, Amazon, and Target, there is no doubt that many employees are worried about future layoffs.
According to Jason Walker and Rey Ramirez, co-founders of Thrive HR Consulting, a significant portion of recent job cuts can be attributed to AI.
“Companies are taking this opportunity to reduce headcount now because they believe that AI can improve efficiency and reduce headcount,” Walker said.
Another reason could be that toward the end of the year, companies “start to look at headcount and costs, and overall reductions in workforces are just made based on that,” he said.
While these layoffs may seem sudden from an employee’s perspective, Walker, Ramirez and other experts say there are some signs employees can look out for that could indicate upcoming layoffs.
Employment and spending slow down
Jaloni Weaver, a Dallas-based high-volume recruiter, said the biggest sign of future layoffs is a “slowdown in hiring.”
Weaver says it’s a red flag if a company stops recruiting new positions or leaves them open for months.
It may indicate that the company may be in financial trouble. And for Weaver, the drop in recruiting meant her own job was at risk.
While a hiring freeze doesn’t necessarily mean layoffs are imminent, “it’s never a good sign if you’re doing well financially,” Walker said.
Similarly, she advises employees to be wary of sharp declines in corporate spending. If a company finds itself in financial trouble, perks like free snacks and ping pong tables can “go away” and year-end bonuses can be reduced or eliminated altogether, she says.
These changes “usually change the culture” and “no one is really happy,” Weaver said.
Change corporate message
Pay attention to what leaders are saying about the future of business, says Ramirez.
Phrases like “We need to be more efficient” are potential red flags that the company is considering cutting jobs, Ramirez said.
Rosie Nestingen, an organizational change consultant, says that when companies start focusing on operations over innovation, “that’s usually a sign that change is coming and people are going to be affected.”
“If one quarter you’re focused on innovation and impact, and the next quarter you’re focused on ‘breaking your back,'” that could be a sign of impending layoffs, she says.
“There’s a lot of language that starts planting seeds and laying the foundation for what’s going to happen,” she continues.
People keep coming out
The last big sign of impending layoffs are “quiet layoffs,” Weaver said. Weaver defines this as companies “looking for ways to fire employees without regard to performance” without formal layoffs.
For example, hourly employees may find their normal work week cut in half, Ramirez says.
“Employees can’t live on 30, 40, even 50 percent less pay, and they’re almost deliberately starting to push people out of organizations,” he says.
According to Walker, RTO obligations can be used as another method of reducing staffing. Research shows that after years of working remotely, many employees would rather look for another job than return to the office.
If your co-workers or bosses start leaving the company themselves, it might be a good idea to follow their example, Weaver says.
They may be aware that the company is not doing well, or their growth may be hampered by a lack of growth opportunities.
How employees can prepare
If you notice red flags that indicate an impending layoff, “don’t just ignore it or think, ‘It’s not going to happen to me,'” Weaver says.
Her biggest advice for employees, she says, is to “keep your resume up to date.”
Weaver says it’s important to stay on top of market trends. She advises employees to read job descriptions for similar roles and pay attention to which skills are being developed.
Weaver recommends asking yourself, “What has changed? What do I want from a new hire, and how can I bring that experience to my current role?”
She also suggests that employees regularly apply for other jobs, “even if you’re happy with your current job,” to keep your resume competitive.
Walker offers similar advice. “Your resume should be ready,” he says. “It’s got to be the best look ever. And if you’re hinting that you’re going to participate, start sending ahead of time and start sending now.”
In today’s job market, “you can’t succeed the traditional way,” Walker says.
Rather than simply sending in an application, Walker recommends contacting the hiring manager for the position you’re interested in directly.
“The ability to get in front of people more personally is really important right now,” he says.
Above all, don’t be complacent with your job, says Weaver. “It’s okay to love where you work, but don’t get too comfortable and miss the signs that things are progressing.”
“At the end of the day, companies are left to do their own thing,” she continues.
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