How to Tell When a Layoff is Coming
Watch out for these clues - Issue #104
The Great Recession ended about ten years ago, for most countries. Now, there are rumors that we may enter another recession in 2020.
UCLA economist Edward E. Leamer predicts that there is a “17% chance that a recession will begin sometime between the fourth quarter of 2019 and the third quarter of 2020.”
If you look further back to the Dot Com Crash, you can see how bad things could become. In 2001, many Tech companies experienced significant layoffs. By the end of the market downturn of 2002, stocks had lost $5 trillion in market cap.
No one knows for sure what is in store for us. However, if we do experience a significant recession, I imagine that larger corporations with deep pockets will survive.
But, millions of smaller companies will need to cut costs, which usually means getting rid of employees. We already witnessed significant layoffs in 2019 at Uber, WeWork, and IBM. I would anticipate that there will be more layoffs this year.
After working in Silicon Valley for over two decades, I’ve been on all sides of the corporate layoff experience. More times than I care to admit.
I’ve been in a small startup where the entire company was laid off after an acquisition. Every single one of us. Such a festive party atmosphere!
I’ve also been at large corporations where I had to lay off people approximately every six months. That’s such an unpleasant experience for everyone involved. It’s very different than letting someone go for poor performance, policy violations, harassment, etc.
After you’ve been through a few of these layoff experiences, you start to notice recurring patterns of behavior. You see familiar signs. You get that little “Uh oh…” feeling in the back of your mind.
I’m going to start by apologizing to my friends in HR and management. I know these things are supposed to be a surprise. However, the real secret is that everyone kind of knows when it’s coming.
Let’s also admit that it is dehumanizing to be walked to your cubicle by security, packing up under the stares of your colleagues, and escorted out of the building. We should find a better way to do this.
Until then, it’s a good idea to recognize when a layoff is coming and be prepared. What do I mean by “be prepared”? It depends on what you anticipate and what you want.
If you fear that you might be on the layoff list and you want to stay, then now is the time to work hard to make yourself more valuable and get off that list.
If you think that you’re on the list and it’s too late to do anything about it, then take your personal items home now. Clean up your cubicle, your equipment, and get ready to walk out the door later with no muss, no fuss vs. rushing while security monitors you.
If the impending layoff is the final straw for you (i.e., you’ve already been thinking about quitting) and you have some time to find another job, then start interviewing and get out of the company before it hits. Heck, you might even want to volunteer to take the layoff package to get a little extra money as you leave.
How can you tell when a layoff is coming? Here are a few of the precursors that I’ve witnessed over the years. Some of these start happening months in advance, but others are a sign that a layoff will be executed within the next 24 hours.
The free food and drinks start to taper off and disappear, or the quality drops dramatically. I still remember the first time I experienced this at a startup. The snack supply slowly but surely dwindled, and they weren’t replaced despite our requests. The leadership team provided vague explanations, but the reality was that the startup was failing and was shut down shortly after that. Now, the inverse isn’t necessarily true. You can't save a failing company with a sudden infusion of free food.
Regularly-scheduled long-term planning activities are suddenly postponed, often with no explanation or some vague hand waving. This behavior is typical when a significant layoff is coming, especially one that will result in a re-org and a change in the key players. It is challenging to make long-term plans that require critical decisions when the decision-makers are going to be changing seats soon.
Hiring is frozen, and open reqs are either put on hold or closed. When this happens, you can hear the groans and angry exclamations echoing throughout the lovely open office space. Managers work so hard to secure reqs to expand their teams. They also know that they had better scramble to fill open reqs because the longer they are open, the more likely something like this will happen. Now, managers not only lose their open reqs, but they also have several people to lay off, and they will probably not be allowed to backfill those positions either. Thus, the angry shouts.
It’s usually a sign that the company is going to lay you off when senior management postpones a meeting with you that they usually would have accepted. Or, you stop receiving invitations to meetings for long-term planning, or where confidential and strategic information will be discussed. As much as people would prefer not to telegraph your termination, they really can’t have you in critical meetings once they know you will be leaving the company.
Entire teams are suddenly reassigned to new management when it doesn’t seem to make sense. I know this move all too well. Sometimes senior management will move a team to a more junior manager to pass on the unpleasant task of the layoff. Thanks, boss.
Large numbers of conference rooms are suddenly unavailable on the same day. When you try to find space in another building, you find that one or two of the best rooms are already reserved on every floor of every building across the campus. Clumsy companies will even let you see that HR has reserved these rooms. Hmmm…
New boxes of Kleenex mysteriously appear in these reserved conference rooms. I’m not kidding. I’ve witnessed this at a couple of large corporations. Either Corporate Facilities knows that we’re all going to be catching colds very soon, or someone is expecting tears. A lot of tears.
All management is suddenly pulled into a series of meetings across a 2–3 day period. Now, this occasionally happens when something massive is going down, like an acquisition or change of top leadership. But, they are probably planing a layoff when your manager finds it difficult to answer you when asked what is going on, or they won’t look you in the eye.
Work-from-home days (WFH) are relatively common in tech companies. However, with an impending layoff, employees will be told that everyone needs to come into the office on a specific day and that they cannot WFH that day. Thus, you've identified the layoff day.
Your corporate VPN suddenly stops working, thanks to IT staff that pulled the trigger too soon. I wish that I was kidding about this one. But, I can remember at least two different occasions when an employee called me to ask why they couldn’t VPN into the network anymore.
Layoffs are an inevitable fact of life, but they aren’t the end of the world. Sometimes it might be just what you needed to knock you out of your comfort zone and onto a better career path.
However, no one likes an unpleasant surprise. It’s good to recognize the signs, be prepared, and brace yourself for the moment you walk into the meeting room and see the smiling face of HR seated next to your manager.
Quick Tip
Trust your instincts. Sometimes you can just feel that something in the office is off.
You can’t put your finger on anything, and there isn’t a big smoking-gun clue, but there is a general atmosphere that triggers that “Uh oh” feeling I mentioned earlier.
“Just because you're paranoid doesn't mean they aren't after you.” ― Joseph Heller, Catch-22
If you’ve been around the block a few times, you’re right to be paranoid. A layoff is probably coming.
Start looking for more clues. Meet with key people who always seem to know what’s going on in the company.
You can also meet with your manager to probe a bit more. Ask how the company is doing, discuss long-term plans, and talk about your career prospects there.
Pay attention to how people behave when you ask questions. Are they acting like they usually do? Or, are they being evasive, and they seem to have trouble looking you in the eyes?
Get the information you need to confirm or disprove your hunch.
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