In today’s economy, nobody’s job is safe anymore.
Major companies and brands that you think will be around for decades could be the next ones to close their doors or significantly downsize. It’s not just the consumer-facing brands that are getting hit hard (think Toys R Us); all major companies have to stay ahead of the forward march of technology, changing spending habits, and shifting demographics or risk becoming the next big-name casualty. To employees, this means that their once “safe” positions could be thrust into a frightening state of instability on a dime, with jobs, income, and financial security vanishing in the wind.
Everyone at every level needs to be vigilant and proactive. Don’t go to work with blinders on or you might be blind-sighted with a layoff notice.
But how can you tell if your company is at risk of closing or downsizing? There is no way to predict the future, but there are a few warning signs and red flags to look out for:
1. Other major players in your industry have shuttered their doors, announced major layoffs, or closed stores, locations, and offices.
Although not a guarantee of trouble, it would still be a bad sign if some of the leading brands in your industry are suddenly downsizing or closing. Some people may view this as good news for competitors (due to a decrease in supply), but when many of the leading brands in your space start closing stores or offices, it usually means that there is less demand for that product or service, which would be bad for everyone in the industry. If you see a bunch of major brands in your industry closing branches and locations or instituting large layoffs, keep your eyes open and don’t ignore these warning signs.
2. Business analysts and other pundits speak loudly and often about trends that would have a large negative impact on your business and/or industry.
When business news repeatedly talks about the doom and gloom that is about to hit (or already hitting) your industry (shoppers prefer online over retail stores; millennials prefer fintech services to brick-and-mortar financial services; younger consumers prefer experiences to possessions, etc.), it’s time to sit up and take notice. You cannot glide through your career with blinders on. Just as management needs to be particularly vigilant to various trends, changes, and innovation that will impact its business, employees also need to keep their radar up to protect their own paychecks. Even so-called blue-chip companies can take a hard hit and fold. Don’t ignore the facts that may be staring you in the face.
3. Your employer has already closed other locations without opening new ones.
Although this is not the kiss of death, it’s still not a good sign. Companies that close locations may just be tightening their belts, but the fear (a justifiable one) is that more belt-tightening may be on the way. Running an efficient business is one thing, but closing down large numbers of offices and stores to cut expenses is not a good sign of development, either for the company or your career.
4. Management institutes a freeze on hiring, salary increases, and bonuses.
If your company places a freeze on hiring more people or announces that there will be no raises or monetary promotions for the next year, take note. There could be other reasons for these actions, but cash flow problems might also be the culprit. If bonuses are cut, delayed, or put on hold, this is also (of course) not good. Keep your ears and eyes open, and try to find out what the reason is for these cuts and freezes.
5. Managers and other bosses seem more stressed (than usual).
If you sense more tension in the air—which may be hard to tell if there’s always enormous stress floating around—there might be trouble in the boardroom. Managers may be asked to do more with less (which could mean your job).
6. Lots of employees (at all levels) are suddenly leaving.
At many offices, there is usually a predictable and somewhat stable flow of departures. If you are suddenly seeing a huge uptick in the number of departure memos, going to lots of goodbye parties, or finding empty desks with no advance warning, that’s a huge red flag. Whether these fleeing employees are recent hires or long-time veterans, don’t ignore the sudden mass exodus of managers or employees at any level. They may see the writing on the wall, have a more transparent manager, or just have more information than you and have acted accordingly.
7. When people leave, they’re not replaced.
When things are going well and Jane in accounting leaves, she’s usually replaced. In the perfect world, New Guy is hired while Jane is still there to train him. If the functions of departing employees are dumped onto the desks of those who stay on—even though they are already overworked—that’s a bad sign (especially if this is more than a temporary shift in responsibilities). If the job listing isn’t posted shortly after someone gives notice, ask your boss or supervisor why, if you can. If not, see if this is happening elsewhere in your company and at what level. It could be that certain positions aren’t being replaced for good reason (remember, technology has changed jobs and industries for 100s of years) or possibly that Jane was really good at disguising that all she did was check her social media all day. If departing employees aren’t replaced, don’t jump to conclusions but keep your eyes peeled.
8. Employees are not as busy as they used to be.
If the click-clack of keyboards at your normally busy workplace has quieted down, and people suddenly have too much time on their hands, you better start brushing off that resume. Whether deals are drying up, customers are disappearing, or clients are few and far between, this is not the sign of a thriving business. You don’t want to be working 24/7, but not having enough work isn’t a good thing either.
9. Benefits and perks are shrinking or disappearing.
A reduction in spending may just mean that companies are trying to optimize their expenses, but it could also mean that they are scrambling to stay in the black. Try to find out which.
Are last year’s benefits and perks no longer available? Keep an eye out for:
- generous health plan extras (like eye-care coverage) removed from the health plan;
- annual holiday party canceled (or drastically reduced in size or scope . . . or scheduled for January, when it’s cheaper);
- free coffee or snacks in the office kitchen no longer offered (or your only perk is Friday lunch);
- regular company outings canceled;
- team lunches are now brown bag only (i.e., bring your own);
- reimbursement policy for business trips reduced (i.e., stipends and maximums for meals, hotel charges, etc. are lowered); and
- generous company-sponsored perks like gym memberships are eliminated.
Be Proactive and Protect Your Paycheck
So what can you do to protect your income if your once-stable job looks like it’s going to end up on the chopping block?
- Make sure you that you have a current resume ready to hand out if an opportunity arises.
- Keep your LinkedIn profile up-to-date (and ask for colleagues to post recommendations for you).
- Network with others in your industry.
- Attend industry events to stay current and increase your network even further. (Bring plenty of business cards and hand them out!)
- Let people know that you want to hear about opportunities. You never know where a simple conversation or contact can lead.
- Throw your hat into the ring for job postings you find online.
- Contact headhunters/recruiters in your field.
- Seek out courses, programs, and webinars to sharpen or expand your skill set.
- Look into certificate programs at colleges and universities to boost your knowledge base and your resume.
- Find a side hustle or look into other part-time work to provide interim income while you are in between positions. You never know where this may lead.