Workplace Red Flags: 5 Signs That Layoffs Are Coming

In today’s unstable job market, it’s essential to pay close attention to signs that layoffs may be lurking around the corner. In this article, we’ll discuss five key indicators that could signal impending job cuts.

Whether you’ve put in your time or are a new hire, spotting the warning signs can help you prepare and navigate through uncertain times with ease. Let’s get into it.

As signs of trouble in paradise are sometimes obscure, it’s crucial to stay vigilant. Here are some subtle yet significant indicators.

If you notice a significant drop in your workload (or maybe that of your team), it could be a sign that layoffs are imminent. For example, if your department handles fewer client accounts or communicates a hiring freeze, it could signify financial strain.

While office gossip, for the most part, is frowned upon. It’s important to keep your ears to the ground and pay close attention to rumors regarding company (or industry) layoffs. Sure, while rumors should be taken with a grain of salt, they are often based on insider information. For example, if you hear colleagues discussing impending layoffs or notice an increase in buzz about job security — amid mainstream news that your industry has seen an uptick in major layoffs — it may be worth a closer look.

A lack of communication from leadership about the company’s financial health or big-picture plans may be a warning sign. Further, if discussions about employee concerns or job security are ignored, your company may withhold information to avoid panic. For example, if your gig begins to tiptoe around important conversations — from financial performance to strategic direction — it could mean trouble ahead.

“Layoffs can be extremely difficult to navigate. The best thing you can do right now is to become aware of every company change and communication,” author, executive, and team coach Marlo Lyons told the Harvard Business Review. “The more alert you are, the easier it will be to predict when to start preparing for your next move.”

Be watchful of any shifts within the organization that could impact your daily routine, regardless of their size.

Sudden key executive departures or restructuring under new leadership can suggest there is trouble in paradise. If a new CEO aims to revive a struggling company, layoffs may be part of their plan to trim costs.

Dropping revenue, sinking stocks, or consecutive losses may pressure management to consider layoffs to cut costs and appease shareholders. For example, if your job reports disappointing financial results or announces restructuring initiatives to improve profitability, it could be a precursor to layoffs.

Companies facing financial strife may offer the option of voluntary departure or early retirement packages. This decision is a method used to reduce headcount without resorting to layoffs. That said, keep an eye out for announcements or emails from HR about such offers. Voluntary departures or early retirement package offers will likely come as a preemptive measure to avoid axing individuals who may wish to remain. For example, if your employer introduces a voluntary separation program with incentives for employees to leave, it could indicate that layoffs are on the horizon.

Now that you have the 4-1-1 on how to identify signs layoffs are coming, you’ll be able to take the appropriate steps moving forward.