The Rebound Effect: Hiring After a Layoff Could Create Unique Opportunities

🏀 The Rebound Effect: Hiring After a Layoff Could Create Unique Opportunities

After a large layoff, some companies experience a "hiring rebound effect," although this can vary widely depending on the circumstances that led to the layoffs, the industry, and the overall economic climate. Here are some reasons why a company might start hiring again after a layoff:

1. Strategic Restructuring:

• New Skill Sets: After a layoff, companies may realize they need new skill sets that weren't previously in-house. This can lead to targeted hiring.

• Business Pivot: If the layoff was part of a strategic pivot, new roles aligned with the new business direction may be created, requiring new hires.

2. Financial Reasons:

• Cost Savings: The primary reason for layoffs is often cost-saving. Once that's achieved, and the company is on more stable financial footing, it may start hiring again.

• Investment in Growth: After stabilizing the financial situation, companies may have the resources to invest in growth initiatives, which often require additional staff.

3. Market Conditions:

• Economic Recovery: If the layoffs were due to economic downturns, a recovering economy could incentivize companies to ramp up hiring to meet increased demand.

• Competitive Pressure: If competitors are growing or innovating, a company may be incentivized to hire new talent to keep up.

4. Operational Needs:

• Workload: Sometimes layoffs go too far, leaving the remaining employees overworked. This can lead to decreased productivity and morale, prompting the company to hire again.

• Special Projects: New projects or contracts may require skills or manpower that the current team doesn't have, leading to new hires.

5. Talent Scarcity:

• High-demand Roles: In industries where talent is scarce, companies may start hiring again quickly to snap up available talent.

A Word of Caution

It's worth noting that a hiring rebound can have its challenges, such as potential negative perceptions from both new and existing employees, as well as the market at large. It’s hard not to be sour when your old coworkers are replaced with new faces. Therefore, companies usually approach this carefully, often with a well-thought-out hiring strategy.

A Personal Note: My former manager did not have such grace after I was laid off. Nothing says ‘compassion’ quite like announcing to the team via Slack that there’s no need to fret over the extra workload, as our departed colleagues will soon be replaced. Needless to say, I’ve painfully seen first hand that the rebound is real.

✨ Where could some of these opportunities be?

While it’s hard to predict the future, these recent layoffs show some indications that rebound hiring could take place sooner than later.

Recent Companies with Potential for Rebound Hiring:

1. Qualtrics [Careers Page]: The company laid off 14% of its workforce to address "internal complexity" created by recent growth. The focus on "recent growth" and "internal complexity" suggests that the company is restructuring to better manage its expansion, which could lead to targeted hiring in the future.

2. Roku [Careers Page]: The company cut its workforce by 10% as part of a cost-cutting restructuring. If the restructuring successfully reduces costs and the company's financial health improves, Roku may be in a position to hire again, particularly in roles that align with its new strategic focus.

3. Flexport [Careers Page]: This supply chain software startup cut 20% of its staff. Startups often go through cycles of rapid hiring followed by layoffs as they fine-tune their business model. If Flexport's restructuring aligns the company more closely with market needs, it may engage in rebound hiring.

4. Chainanalysis [Careers Page]: The company cut 15% of its staff to focus on "more stable" government contracting. This suggests a shift in business strategy that could require new hires with expertise in government contracts.

Things to Consider When Looking for Rebound Opportunities

• Find Hidden Jobs: For various reasons, companies don’t always advertise their open roles. Leverage your LinkedIn network or work with recruiters that have early access to these job postings.

• Strategic Alignment: How closely aligned are the companies' restructuring reasons with their long-term goals? The more aligned they are, the more likely they may engage in rebound hiring.

• Financial Health: Are these companies financially stable enough to afford new hires? Financial stability post-restructuring could be a strong indicator of future hiring. BONUS TIP: Check out when their latest funding rounds occurred and for how much on sites like Crunchbase and G2. This can give an indication the type of war chest that they’re sitting on.

• Market Demand: Is there a market demand for the products or services these companies offer? Companies are more likely to hire if there is a strong market demand for what they offer.

📉 Notable Layoffs this Week

• LinkedIn has announced it will eliminate approximately 668 employee roles across the company. Roles will be impacted in the engineering, product, talent and finance arms and are equal to roughly 3% of the company's global workforce.

• Stack Overflow has laid off 28% of its staff, or more than 100 people. The cuts come a year after the coding forum doubled its headcount, The Verge reports.

• About 50% of indie music platform Bandcamp's employees have been let go after the company was acquired by Songtradr, Variety says.

• Chipmaker Qualcomm is laying off 1,258 employees beginning on Dec. 13, CNN reports. The cuts represent roughly 2.5% of its 51,000-person workforce.

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🔗 Misc Headlines & Resources

• For in-demand job skills, check out Google Career Certificates. They currently have training for Cyber Security, Data Analytics, Digital Marketing, IT Support, Project Management, and UX Design. [Link]

• California Fully Recovers All Jobs Lost to the Pandemic-Induced Recession, Creates More Than 20% of the Nation’s New Jobs in October [Link]

• Google cuts dozens of jobs in news division [Link]

Curious if your company has a layoff planned?

Look into the crystal ball to see if your company has a layoff coming up by leveraging federally mandated WARN notices!

www.warntracker.com