A recession may be on the horizon, but there are still ways to get ahead.
Over the course of the past three years, the job market has been a bit…erratic. At the outset of the pandemic, lockdowns and an economy paralyzed by the threat of the virus caused companies to shed millions of workers. Then, oddly, things shifted: In search of greener pastures, people began leaving their jobs in droves, and the number of job openings soared. Suddenly, companies were scrambling to fill their ranks, and for a while, finding a new gig was relatively easy.
“Employees had the upper hand and could really dictate a lot,” from more flexibility to more money, says Kerry Sulkowicz, M.D., a clinical professor of psychology at New York University and the head of Boswell Group, which consults prominent executives on workplace culture.
Now, it seems the tide has turned yet again. Bracing for the possibility of a recession, companies are tightening their belts, and some — from Meta to Morgan Stanley — have turned to layoffs. Understandably, this has many workers on edge. (According to a recent survey by Insight Global, 78 percent of employees said they’d be worried about keeping their jobs if the U.S. were to sink into a recession.) Fortunately, there are a few things workers can do now to de-stress, and prepare for what could be a bumpy rest of the year.
Check out the highlights of KCM’s call with Sulkowicz, or read some ultra-important takeaways, below:
Worried about layoffs? Here’s what to do.
Dorie Clark, who teaches executive education at Duke’s Fuqua School of Business, says the first step is to embrace the possibility that in a tough economy there’s a chance your company could falter or even go belly-up.
“I think a lot of people, just by dint of human nature, tend to avoid looking at that possibility and asking the hard questions, because it can be emotionally uncomfortable,” Clark says. But that instinct can really put you at a disadvantage if you’re forced to go back onto the job market — potentially at the same time as hundreds of your similarly qualified peers.
Clark’s a strong advocate of being proactive when it comes to charting out your career trajectory, and part of that, she says, is cultivating a personal brand. Building a name for yourself within your industry, be it HR or computer programming, is work. It takes networking, getting involved in professional associations, writing for industry publications, and attending conferences, Clark says. (And because every workplace trend these days has a catchy phrase to accompany it — think “quiet quitting” or “unretirement” — this common practice has come to be called “career cushioning.”)
“Those are all things that many professionals view as discretionary activities, so they don’t make the time for them,” says Clark. “But they’re the kind of things that can be a saving grace in an economic downturn.”
That’s a common misstep: It’s easy to become so focused on excelling in your current post that you lose sight of how to protect yourself if you’re laid off or help yourself advance in your career, Clark says. And Sulkowicz agrees that it pays to be strategic about your next move.
There are also simple things you can do now if you’re especially anxious. Take a few minutes to polish up that resume and LinkedIn profile (making sure to change your privacy settings so you don’t alert your connections, and potentially your boss, that you’re open to new opportunities). It’s also not a bad idea to start stashing more money away into your rainy day fund or grabbing coffee with an old colleague or two to “refresh those ties in case you need a hookup in the future,” Clark says.
Is now still a good time to look for a new job?
That period between late 2020 and early 2022 was a “historically marvelous” time for jobseekers, simply because there were just so many openings, Clark says. But that was rare. Traditionally, employers are the ones who hold the power in the job market, and right now we’re returning to that status quo. From January to April of 2023, employers have said they’re looking to cut 337,411 jobs — a 322 percent increase compared to the same period last year.
That may seem wildly high, but economists say the labor market is still tight — meaning there are too many jobs and not enough workers to fill them. So now still isn’t a bad time to be looking for a new gig — even if you’re in an industry like tech which seems to be getting pummeled right now with round after round of layoffs, Clark says.
“Frankly, tech workers are still in high demand,” she says. “They may have to go from a ‘sexy’ company like Google to a less sexy company in an industry like banking or insurance, but they’ll likely be able to find another position quite quickly.”
How should managers talk to workers about layoff plans?
It’s never easy to break that bad news or even to discuss the potential for layoffs, but Sulkowicz has some basic guidelines managers can follow. First, be clear; explain in plain language why the business needs to make cuts. That means avoiding euphemisms or acronyms like the dreaded “RIF,” or reduction in force.
“Don’t use these silly acronyms because that means you’re hiding behind language that reveals your discomfort in your leadership role,” he says.
The other thing he suggests is that, when possible, organizations should make the layoffs all at once, as opposed to doling them out over a long period of time — which can feel a little like “death by a thousand cuts.” And Sulkowicz believes it’s important that that message be delivered from the top, “otherwise it just looks like the CEO is hiding from delivering it.”
It’s also crucial that leaders exhibit a degree of empathy for both those affected and for the employees that remain.
“They need to acknowledge that some of the people let go were good people and good workers and good colleagues. Employers need to be aware that some employees’ close friends from work might have been let go, not because of any fault of their own,” he says. “The more that can get articulated, the better.”
