What To Do If You Get Laid Off (& How To Be Proactive About It)

Hey there, friend. If you’ve just been laid off, I know it feels like the rug’s been pulled out from under you. Shock, anger, worry, overwhelm—those emotions might be hitting you all at once, and that’s okay. You’re not alone in this. Layoffs are more common than you might think—millions go through it every year, from the 2020 pandemic chaos to the 6 million folks on unemployment in 2023. The key? Don’t let it define you. It’s a tough moment, but with some grit and strategy, you can bounce back stronger. Let’s talk about how to navigate this and come out on top, with practical steps to get you moving forward.

Laid Off vs. Fired: What’s the Difference?

First things first, let’s clear up a common mix-up: being laid off isn’t the same as being fired. A layoff happens when a company no longer needs your role due to things like downsizing, restructuring, or budget cuts—nothing to do with your performance. Fired? That’s tied to your actions or job performance, like missing targets or breaking company rules. Knowing this distinction is huge because it means a layoff isn’t a reflection of your worth or skills. It’s just business. So, let’s not take it personally and focus on what’s next.

6 Questions to Ask When You’re Laid Off

Getting laid off can feel like a whirlwind, but asking the right questions early on can give you clarity and control. Here are six key things to ask your manager or HR:

1. Can I list you as a reference? Since layoffs aren’t about your performance, most managers will be happy to vouch for you. This can show future employers you left on good terms and your work was valued.

2. When does my health insurance end? Check with HR to understand how long your coverage lasts. You might qualify for COBRA, though it can be pricey. If not, explore options through the Affordable Care Act (ACA) marketplace.

3. What happens to my 401k? Your 401k funds are yours to keep. You can leave them in the account, withdraw them (watch out for taxes!), or roll them into another retirement account like an IRA. A financial advisor can help you decide what’s best.

4. Will I get a severance package? Some companies offer severance—cash, extended benefits, or both. Review your employment contract or ask HR to confirm what you’re entitled to before signing anything.

5. When’s my last paycheck, and does it include unused PTO? Know the exact date of your final paycheck to plan your finances. Also, check if you’ll be paid for any unused vacation or sick time—don’t leave money on the table.

6. How long do I have to exercise my stock options? If you have stock options, you typically get a 90-day window post-employment to act on them. Confirm the timeline with HR or your contract to avoid losing out.

Filing for Unemployment Benefits

If you’re eligible, unemployment benefits can be a lifeline while you’re between jobs. Here’s how to get started:

1. Check your state’s rules. Every state runs its own unemployment program. Visit the U.S. Department of Labor’s website to find your state’s office and requirements.

2. Fill out forms carefully. Accuracy is everything—mistakes can delay or derail your claim. Be honest about why you were laid off, as your employer will verify your answers.

3. Keep up with weekly claims. Most states require you to file weekly updates to confirm you’re still unemployed, actively job hunting, and in need of benefits.

4. Ask for help if you’re stuck. Government processes can be confusing. Don’t hesitate to reach out to your state’s unemployment office for clarification.

How a Layoff Impacts Your Job Search

Worried that a layoff will make you look like damaged goods to hiring managers? Don’t be. Most understand that layoffs are about company needs, not your performance. Be ready to explain your situation calmly and factually in interviews—no need to hide or feel ashamed. Transparency is your friend here.

4 Steps to Bounce Back After a Layoff

Okay, let’s get to the good stuff: how to turn this setback into a comeback. Here are four proactive steps to take:

1. Get your finances in check. Without a steady paycheck, it’s time to tighten the belt. Cut out non-essential spending (sorry, daily lattes) and focus on covering must-have expenses like rent and groceries.

2. Polish your resume and LinkedIn. Your resume and LinkedIn are your first impression in the job market. Update them with your latest experience and tweak them to stand out. Use Jobscan’s free resume templates for a sharp, professional look, and switch your LinkedIn settings to signal you’re open to new opportunities.

3. Tap into your network. Did you know 40% of hires come from referrals? Reach out to friends, former colleagues, and professional contacts to let them know you’re job hunting. A quick message or coffee chat could lead to a game-changing introduction.

4. Kick off your job search with gusto. Yes, starting over can feel overwhelming, but approach it with optimism and persistence. Explore job boards, company websites, and networking events to find roles that excite you. You’ve got this.

Wrapping It Up

A layoff can feel like a punch to the gut, but it’s not the end of your story—it’s just a plot twist. By asking the right questions, filing for unemployment if needed, and taking proactive steps like updating your resume and leaning on your network, you’ll be back in the game in no time. Stay focused, keep your chin up, and trust that the next chapter of your career is waiting. You’re tougher than the toughest storms, and I’m rooting for you!

P.S. Want more tips on navigating your job search? Check out Career Katalyst's blogs for free strategies to help you land your next role faster.