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What to Do if You’re Laid Off

If you’ve been laid off, or if someone you care about lost their job recently, you’re not alone—and I want you to know it’s going to be okay. We’ll walk through some practical and effective ways for you to move forward, even in the face of anxiety and uncertainty.

Just because you lose your job doesn’t mean you’ll lose everything else, so don’t let fear blow this event out of proportion. You’ll have to decide to press on—and I’m here to help you take the first step.

What Does It Mean to Be Laid Off? 

If you got laid off, it’s not because of something you did—getting laid off means your employer had to let go of team members. The harsh reality is, when the economy grinds to a halt (like we’ve seen in the past few years), companies simply can’t meet payroll—which leads to layoffs. Unfortunately, most businesses aren’t letting people go because they want to, but because they have to.

Common Causes of Layoffs

Sometimes layoffs happen because of hard economic times or because a company goes through a major change, like being bought out. In both situations, jobs are cut. Here are some other common causes of layoffs:

  • A recession: When the economy tanks, businesses have to adjust their spending—including payroll.
  • There’s employee overlap: Sometimes jobs are cut when two people are doing the work of one person.
  • Downsizing: Maybe a business has lost clients or revenue and there are more employees than needed for the work.
  • Restructuring: When a business reorganizes its teams, people will be laid off if their roles aren’t necessary for the new teams.
  • A company closes: When a business shuts its doors, everyone will be laid off because, well, there’s no more work to be done.

No matter the cause of the layoff, you have what it takes to move forward after this setback.

What to Do After Being Laid Off

You’re probably feeling a lot of emotions right now—especially if you lost your job at Christmas. That’s to be expected. Whether you’re feeling scared or angry (or both), give yourself time and space to process before you move forward. No one makes good decisions when they’re panicked, so let’s start by calming down.

Take a deep breath.

Layoffs are shocking because they’re usually unexpected. Lots of leaders don’t want their team members to suffer, so they turn to layoffs as a last resort to help save the company or cut costs. But the reality is, losing your job just sucks. So, give yourself some time to pause, process and find perspective. This could be a chance to finally switch careers and start your dream job or go back to school to finish your degree.

Collect your final paycheck or severance pay.

Ask your employer how you’ll get your final paycheck after the layoff. Your employer might also offer you severance pay when they let you go. This could be a one-time payment, or it could be several payments spaced out over a few weeks or months. The Fair Labor Standards Act doesn’t require that your employer give you severance benefits, so this will vary from company to company.1

If you don’t receive a severance package, unemployment is another option that can help you stay afloat after a layoff. You can get unemployment insurance benefits by filing a claim with the unemployment insurance program in the state where your job was. These guidelines vary by state, so check out the U.S. Department of Labor website for more info!

Figure out your health insurance options.

If your health insurance ended with your layoff, you have a few options to keep a policy. One of your options is COBRA insurance, which lets you stay on your employer’s plan for up to 18 months. But most of the time, your former employer isn’t going to pay their side of the premium, which means your monthly payments will be pretty high. You’ll probably save money on a government health care plan or a private plan with a high deductible. Take the 5-Minute Coverage Checkup to figure out what type of insurance you and your family actually need.

Tap into your support system.

When you’re ready, be open with your friends and family about your job situation. You don’t have to share all the details with everyone—in fact, feel free to set some boundaries if you don’t want them to pester you with questions. But acknowledge that you’re facing a hard time and surround yourself with people who will support you and encourage you.

Get Everything You Need to Land the Job You Love!

If you’re married, be open with your spouse. Don’t let shame keep you isolated in the dark. If you have kids, talk about how the job loss will impact your lifestyle and the time you spend together (in an age-appropriate way). Do whatever you have to do to get the support you need.

Make a new budget.

It’s scary to think about what will happen if you miss a paycheck. Hopefully you have an emergency fund (3–6 months of living expenses saved up) to get you through the tough times. But whether you do or not, it’s time to sit down and make a zero-based budget based on your new income level.

EveryDollar is our budgeting app that makes it super easy to start taking control of your money (and it's free!). Once you make a plan for your spending, it's time to hit pause on all nonessential purchases—like streaming services and gym memberships—at least until your income level is back to normal. 

Create some new daily routines.

Your time has been shifted around, so use it to your advantage! Your top priority is to find a new job (and we’ll talk about that below). But if you end up with a little more free time right now, this is a good time to pick up that novel you’ve been wanting to read, volunteer in your community, or spend more time walking around your neighborhood. Don’t stop showering, waking up at a decent hour, or exercising just because you’re not going in to work. You’ve got to take care of your mental health during this uncertain time. (Not to mention—staying up to date on current events, being involved in your community, and continuing to grow personally will show your next hiring manager you know how to use this time wisely!)

How to Find a Job After Being Laid Off

You can’t live on severance pay or unemployment benefits for long, especially if you have a family to take care of. Here are three practical ways to get back out in the job market and look for work:

1. Get clear on your talents, passions and mission.

Okay, guys, first things first. When you’re looking for a new job after being laid off, take this opportunity to really think about your next step. What were you born to do? If you’re not sure, check out my Get Clear Career Assessment. You’ll take a quick assessment to understand your top talents, passions and mission. You’ll also get a personal purpose statement to discover a few options where you can apply your strengths in the workplace.

2. Use your connections to move into another field. 

If your whole industry has taken a hit this past year, it might be time to start branching out into other types of work. A recession-proof job can give you the job security you're looking for. Be willing to step outside your comfort zone and even take lower pay for the time being.

Start your job search by making a list of people in your immediate circle who can help you get connected. Reach out and let them know about your situation. Be bold—but not obnoxious—as you ask about work opportunities. You never know what opportunities might be just one conversation away. But be mindful and try not to contact someone for help at a time when they’re stressed about their own work situation. 

If you don’t have any success asking your immediate circle, don’t be discouraged. Often, it’s not about who you know—it’s who they know. Keep digging and expanding your network. It might take a few days or weeks, but if you’re persistent, you’ll start to find opportunities. And as you prepare for your interviews, make sure your resumé is in good shape!

3. Check online job boards for contract and part-time work. 

Sites like LinkedIn and Indeed update their job boards regularly with relevant and timely work opportunities. Check in often to find opportunities that match your skill set. Also keep an eye on your favorite local businesses. They might need extra help during the holidays or tourist seasons.

Many industries likely need to fill extra roles temporarily. A local media station might need administrative help to keep up with increasing news coverage. Or maybe a local catering company could use temporary drivers to deliver at-home meals.

How Is a Layoff Different From Termination or Furlough?

While getting laid off is the result of the company’s decision, getting fired is the result of your actions. Most of the time, people get fired because of poor job performance. Maybe you’ve been irresponsible and haven’t handled your tasks well, or you don’t have the skills you need to do a good job in your current position. You can also get fired due to character issues, like being unreliable, dishonest or a bad team player.

A furlough is an extended leave of absence from a job, with the expectation that you’ll return sometime in the future. Furloughs are a normal occurrence in some jobs, like when professors take a sabbatical (a semester off from teaching). Getting laid off, however, is a permanent release from your job.

You've Got This.

Getting laid off from a job is tough. But you can use this time to your advantage if you stay calm, evaluate what it is you want to tackle next, and come up with a game plan to get back out there and start preparing for interviews.

This is not the end, and it won't define you. You have what it takes. Press on!

Next Steps

1. Check up on your finances. First things first, make sure you and your family have enough money to keep food in the fridge, gas in the car, and the lights on until you find a new job. If not, you'll need to find a temporary job—like gig work, a side hustle or retail—so you can make ends meet until you get a new full-time opportunity.

2. Start looking for a new job. You don't need me to tell you this one! Get out there and tune up your resumé, make new connections, and start applying.

3. Get clear on what role is right for you. Use this time as an opportunity to really ponder your next career move. Ask yourself, Am I using my talents? Am I passionate about my work? Do I care about the results I'm creating every day? If not, my free Career Clarity Guide will help you identify new roles—or even a new career—that'll let you answer yes to all three of those questions.

Get the Guide

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Ken Coleman

About the author

Ken Coleman

Ken Coleman is a career expert and author of the national bestselling book From Paycheck to Purpose and the #1 national bestseller The Proximity Principle. He hosts The Ken Coleman Show, a nationally syndicated, caller-driven show that helps listeners discover what they were born to do. Ken makes regular appearances on Fox News, and he co-hosts The Ramsey Show, the second-largest talk show in the nation. Through his speaking, broadcasting and syndicated columns, Ken gives people expert career advice, providing strategic steps to grow professionally, land their dream job, and get promoted.  Learn More.

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