19 Early Warning Signs of Layoffs: Prepare Before the Rain Falls

Before the news of Lazada’s retrenchment died down, we heard similar announcements from Google & Amazon.

If the big boys are struggling with payroll, you can imagine every other company downstream, 

Over my 20-year career, I’ve witnessed the gut-wrenching reality of layoffs twice, narrowly escaped another, and even had to guide people through them during the global financial crisis. 

While predicting the future is impossible, knowing the telltale signs can prepare you for what’s ahead. 

Here are 19 early warning signs of layoffs, gleaned from both my experiences and those of my newsletter subscribers:

Communication Breakdown:

  • Decreased contact with your manager: Fewer emails, calls, or meetings, especially if their communication with others remains unchanged.
  • Radio silence from HR: Emails and calls to HR go unanswered, even on seemingly urgent matters.
  • Sudden disappearance of your boss: If your manager is abruptly let go, especially if you’re their direct report, be on high alert.

HR on overdrive:

  • Frequent, lengthy HR meetings: Conference rooms booked by HR all week rarely signify good news.
  • Solemn faces and tight lips: If even HR’s usual cheerfulness takes a dive, something serious might be brewing.

Whispers and worries:

  • Persistent rumour mill: Internal gossip about layoffs, especially if echoed by external sources, should not be ignored.
  • Sudden exclusion from meetings: Being overlooked for important meetings you typically attended could hold hidden meaning.

Bypassed and sidelined:

  • Your boss bypasses you: When your manager directly contacts junior colleagues or tasks normally delegated to you are reassigned, pay attention.
  • Unnecessary understudies: A new “team member” mysteriously joining your project right before your workload decreases can be a red flag.

Training roadblocks:

  • Rejection of relevant training programs: Being excluded from training opportunities, especially those your manager previously encouraged, speaks volumes.
  • Impromptu performance reviews: Function heads focusing on identifying “inefficient” individuals could be preparing a layoff list.

Hiring freeze and beyond:

  • Recruitment put on hold: All open positions suddenly disappearing can signal impending downsizing.
  • “Special projects” for senior staff: When senior colleagues get assigned vague “special projects” while their core tasks are reassigned, it’s often a prelude to departure.

Mergers and shakeups:

  • Your company gets acquired or merges: Unless your company is the acquiring entity, prepare for potential redundancy.
  • Major changes in reporting lines: Sudden reorganisation and reassignment of teams under new managers could mean job cuts.

Unnerving signs and departures:

  • Frequent visits from unfamiliar faces: Whether future owners or bankers, their presence often indicates potential restructuring.
  • Growth at breakneck speed: Rapid, unsustainable growth can lead to sudden corrections and layoffs, as seen with Groupon’s expansion and subsequent downsizing.
  • Senior management exodus: When high-level employees leave en masse, it’s time to update your resume.

Financial woes and frills cut:

  • Employee benefits under fire: Fewer company events, reduced birthday perks, and even disappearing office snacks can hint at cost-cutting measures.
  • Unpaid bills and vendor complaints: When vendors refuse to deliver due to outstanding payments, financial trouble is evident.

The ultimate red flag:

  • Company email access disabled: This, unfortunately, leaves little room for doubt.

Bonus tip: Observe a sudden rise in the “internal consultant” population – these “Chief Innovation Officers” are often brought in to streamline operations, which can involve downsizing.

Remember, spotting all signs might be impossible. 

Keep your skills sharp, your network strong, and your ear to the ground. 

Prepare for the storm before the first rumble of thunder, and when the rain comes, you’ll have an umbrella ready.

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