BBB Advice on Steps to Take After Getting a Pink Slip

  
     
July 18, 2008

With most leading economic indicators pointing toward continued tough times, businesses are cutting back and many Americans, after years of working for the same company, are suddenly finding themselves out of work. Given that most job search processes take three to six months, getting back on your feet again isn’t only about polishing and distributing resumes, but also requires a good grasp on handling benefits and managing a budget. Whether it is a layoff, a severance package or some other form of business restructuring, Better Business Bureau is offering step-by-step advice for people who have recently been given the pink slip.

According to the Bureau of Labor Statistics, in April 2008, private-sector employment experienced declines for the fifth month in a row, with 29,000 jobs lost. In recent months the hardest hit industries have been construction (-64,000) and manufacturing (-46,000), shedding a total of 110,000 jobs. The nation’s unemployment rate is now at five percent which means there are currently 7.6 million Americans looking for work.

“Every day we hear about another major corporation contending with the current downturn in the economy by cutting back and laying off hundreds and even thousands of employees,” said Steve Cox, BBB spokesperson. “And with credit markets tightening, not only are many Americans already struggling to keep their homes from entering into foreclosure, but now they have to deal with staying afloat without the steady income their job provided.”

BBB offers the following advice on dealing with losing a job and acting quickly to get back on the right track toward finding a new one:

Say Goodbye to the Old Job
While receiving word that you’ve been let go can be extremely emotional and can make it hard to keep a clear head, employees need to make sure they understand the terms of the situation including any benefits they are eligible for. Many companies provide a severance package and, by law, employees are entitled to any accrued vacation. Laid-off employees should also ask their former employer for references - if they left on relatively good terms - to help with their job search.

Line up Unemployment Benefits and Health Insurance
It’s important to get the ball rolling immediately by applying for unemployment benefits through the state unemployment office since it can take up to three weeks to start receiving checks. Eligibility requirements vary by state and typically take into account wages earned, length of employment, and reason for unemployment.

If the employee received health insurance under their former employee, he or she can apply for coverage under the Comprehensive Omnibus Budget Resolution Act (COBRA). COBRA provides up to 18 months of health insurance after being laid off. A company’s Human Resources department will have application information or employees can go to the U.S. Department of Labor Web site at www.dol.gov.

Evaluate Family Finances and Cut Wasteful Spending
Having and managing a budget is crucial to success in unemployed situations - if the employee didn’t have a family budget, now is the time to make one. Money will be tight and evaluating expenses, including finding ways to cut costs, will help a family get through the lean times. The worst thing to do is to ignore bills as they keep piling up. BBB recommends keeping in contact with lenders to explain the current unforeseen situation and potentially work together to find solutions for weathering the financial storm.

Click here for additional BBB advice on creating a budget

Keep Busy
Job hunters should take inventory of their career and consider the opportunity to change occupations or relocate to a new city. Being laid off can be a discouraging time to start looking for a new job, but it is not the time to let the grass grow underfoot. BBB recommends filling the down time in a job hunt by volunteering, learning new skills or taking continuing education classes. Remember that many experts consider looking for a job a full-time job in and of itself.

For more trustworthy advice on finding a new job, including enlisting the help of an employment service, polishing a resume and job interview tips go to www.bbb.org.