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How to Know if Layoffs are Coming: 5 Warning Signs to Look Out For

Woman at computer concerned about being laid off

Gwen H. had enjoyed several years at a well-established nonprofit when a series of events suddenly led her to question the security of her job. “There were a lot of power leadership changes happening,” she remembers. In the first few months she watched warily from the sidelines, unsure what to make of the jockeying executives. It was only when she learned that her boss, who had previously announced she was retiring, was actually looking for other work, did she realize the shifts might be seismic.

When a company’s stability is already compromised, an employer might go to great lengths to conceal any indication of impending layoffs. But, as anyone who has been through a layoff can tell you, there are usually a few telltale signs—at least in hindsight.

Signs of Layoffs #1: Leadership’s in Flux

Acquisitions and mergers are obvious times when leadership will find itself undergoing reorganization that can lead to widespread dismissals. However, when numerous, abrupt retirements and resignations are taking place for any reason—it’s a good sign that trouble is brewing above.

Signs of Layoffs # 2: New Language

When executives begin to use terms like “restructuring, “reorganizing” and “streamlining,” some positions are usually on the chopping block. When IBM was in the midst of laying off employees in 2015, it used the term “workforce rebalancing,” emphasizing the financial angle of employment decisions. Indeed, most of the euphemisms—chief among them “downsizing”—imply that people will lose their jobs as a form of budget cuts.

Sign of Layoffs #3: A Budget in Distress

It stands to reason, then, that one of the most reliable indicators of impending job loss is in the budget. The first things to go might be little luxuries, say reducing first-class travel and expensive coffee in the breakroom. By the time the office is being moved to more modest location, however, there is a good chance the numbers aren’t looking good. When you learn that vendors aren’t being paid on time (or at all), human resources most likely knows something you don’t.

Signs of Layoffs #4: Projects Are Being Pruned

When businesses launch new and innovative initiatives they are spending resources to explore and grow creatively (if not immediately profitably). When non-essential programs are being brushed aside and/or actually cut, your employer is likely in a bare-bones mentality.

Signs of Layoffs #5: You’re Feeling Iced Out

Managers often know in advance that layoffs are coming. Avoiding eye contact and one-on-one conversations is a natural instinct in the face of impeding conflict. More concretely, if the scope of your responsibilities is shrinking, your colleagues are being assigned projects that would formerly have gone to you or—the horror!—you’re being asked to train someone else in your duties, there’s a good chance your employer is setting you up for a smooth transition—out.

It’s a fine line between cautious observance and paranoia. But when it comes to job security, Gwen says, “that saying about ‘the best defense’ is really true.” While many in her organization were let go or replaced, her astuteness helped her land on her feet. After polishing her resume, she began spending evenings job searching online. Although she was sorry to resign from a job she truly enjoyed, she says, in the end she landed another she loves just as much (and with a salary she loves even more!).

The take-away? Stay on the offensive by keeping an eye out for signs of layoffs and you’ll weather transitions with the least disruption to your career and your income.