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Ask Chuck: Get prepared for layoffs

Ask Chuck your money question

Dear Chuck,

I work in the technology sector and am worried about getting laid off. Can you help me be prepared?

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Worried about Layoffs

In this photo illustration, a person files an application for unemployment benefits on April 16, 2020, in Arlington, Virginia.
In this photo illustration, a person files an application for unemployment benefits on April 16, 2020, in Arlington, Virginia. | AFP via Getty Images/OLIVIER DOULIERY

Dear Worried about Layoffs,

I have friends whose daughter-in-law was laid off a month ago. Then their son, who is married to that daughter-in-law, was laid off last week. Both held good jobs in the tech industry. Many people are in the same circumstance. Accenture, Google, Amazon, Microsoft, Meta, Salesforce, Yahoo, Zoom, and many more have announced cuts in their workforces. In fact, 696 tech companies have laid off 197,985 employees so far this year. According to Nerdwallet, tech employment grew during the pandemic to meet the need created for work, shopping, and socializing.

We see big companies correcting for over-hiring and underperformance and preparing for the rise of AI. This may continue until inflation is corrected. Changes are happening in the industry, but the news is not all bleak. Some startups are recruiting software developers, data scientists, and engineers, but many are replacing workers with offshored contractors.

Despite the anticipation, fear, stress, and disappointment of a layoff, do not despair or panic. Be upfront with your spouse. Together, ask the Lord for wisdom and direction. Be mindful of the many things for which you can be grateful and thank Him. Here are some practical steps:

Be diligent before you go

If you do get laid off, it is important to ask your employer these questions, as suggested in an article by the Harvard Business Review:

  • When will I receive my last paycheck?
  • Do I get paid for unused vacation time (and sick days)?
  • Do I receive severance pay?
  • How long will I have to exercise stock options?
  • How long will I have healthcare coverage?
  • Will you provide a reference for me?
  • When can I get copies of my performance reviews?
  • What happens to my 401(k), 403(b), or retirement plan?

Managing your money

To prepare yourself for a layoff, immediately cut back discretionary spending. Aim to have housing, utilities, cars, and necessary expenses covered. Implement a crisis budget. Check the current balances in all bank accounts, when CDs mature, and other investments that could be converted to cash if needed quickly. If you have adequate savings, don’t blow it on a vacation. Take care of yourself but with a frugal mindset.

View this as an opportunity

Be optimistic while trusting the Lord. It’s possible that your job is not in jeopardy. Can you discuss the situation with your manager? Perhaps, you will discover that your fear is unfounded. You may learn ways to improve your job performance. If, however, you discover that a layoff is inevitable, you will at least have time to prepare emotionally and financially. It may be an opportunity to change course, move into a new career, or verify that you are in the right industry.

I believe it is always a good idea to be aware of other job opportunities. Update your resume and LinkedIn profile. If you do lose your job, notify business contacts of your availability, along with friends who may be able to help. Though humbling, this may actually open a wonderful new chapter in your life. Use your free time to update skills and acquire new ones. Read, research, and study companies you believe would be a fit for your skill set or those in which you have an interest. Prepare yourself for future interviews here and here.

“Be strong and courageous. Do not be frightened, and do not be dismayed, for the Lord your God is with you wherever you go” (Joshua 1:9 ESV).

Pray with trusted friends and ask God to work in ways beyond your comprehension. I have seen God close one door only to open a better one for thousands of people we have served and coached.

Crown has a great assessment and coaches available to help guide any decisions you may be making regarding your career path. We also have Budget Coaches if needed. Reach out if we can help in any way.

Chuck Bentley is CEO of Crown Financial Ministries, a global Christian ministry, founded by the late Larry Burkett. He is the host of a daily radio broadcast, My MoneyLife, featured on more than 1,000 Christian Music and Talk stations in the U.S., and author of his most recent book, Economic Evidence for God?. Be sure to follow Crown on Facebook.

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