Wednesday, April 8, 2009

It’s better to be laid off than laid on, Part 2 of 2

In Part 1, we discussed a little bit of layoff-proofing.  Part 2 involves how layoffs work.

            At the first sign of a period of slowing income that will be more than just one or two months long, the firm looks in Round 1 to trim fat painlessly.  One way to do this is for people to quit and just not replace them.  In an architecture firm, this could be design staff, but it’s just as easily and more likely to be overhead staff—administrative and accounting staff, office management, spec writers and quality control plan checkers, construction admin staff, and the like.  At my office, for example, a member of accounting got a new job closer to her house, and an architect who had been out for maternity leave decided to stay gone.  Problem solved.  A not-so-nice way to eliminate staff is to make life unpleasant for someone so that they’ll quit on their own.  Not only does this trim the costs of a paycheck and benefits to an employee, but if they quit on their own the firm doesn’t have to pay them unemployment or severance.  Non-personal ways of saving money at this stage often include things like adjusting the thermostat and reining in reimbursable expenses, like travel/mileage and printing costs that can’t be directly billed to a project or client.

            Round 2 comes when things are still looking tough and lean, or leaner.  The firm lays off obvious cash drains, like overhead staff and/or people who either have insufficient or unusable skills.  At our office, this included several underperforming interns on the architecture and interior design staff, a spec writer (we had no projects for him to write specs on, nothing personal), an administrative assistant whose work could be covered by the other assistants in the office, and the office manager, one of two total, who had an attitude problem.  Many of these were employees with whom the firm had discussed their lack of performance, and that performance had not notably improved or had worsened.  However, at the office of a friend of mine, they laid off two guys who did nothing but construction administration.  They were perfectly decent employees, but since the office only had a couple of projects in the early design phases and wouldn't need folks with CA experience for at least another nine months, it was easy to let those employees go.  The thing about Round 2 is that, witha few exceptions, attitude and A-game count here.  Depending on how the employment is terminated, the employees might get fired or laid off; in the latter case the employee gets unemployment benefits and may even get severance.    Round 2 gets rid of the crankybuns, the whiners, the people who only warm seats for eight hours a day, regardless of how much work they have to do.  You know those people who say, “Yeah, I’d like to see them try to lay me off/fire me” or even “If they don’t like it, they can fire me.”  These are often the people being shown the door during Round 2.  Even if you sympathize with these people now and again, keep it to yourself. 

            A note about Rounds 1 and 2: they can often be done very slowly and subtly such that they barely register on anyone’s radar.  At my office, the first two rounds happened gradually, such that when Round 3 came, I and many others were surprised: layoffs?  Here? Huh?  It was not until a coworker who was part of Round 3 pointed it out to me that I realized that we had eliminated about ten to fifteen jobs over the course of the past eight months.

            If things continue to be bad, along comes Round 3, when the layoffs start to hurt.  People who are part of this round are productive and useful, and losing them can hurt.  In some cases, like at my office, some of the people involved in Round 3 were productive and talented but still had some blemishes on their records.  For example, a sampling of the people let go in Round 3 of various firms’ layoffs (in Denver in 2008):

  • Intern, 40: started out at the firm with a reputation for not being thorough but had improved somewhat during her time there; frequently wore jeans and flip-flops with a couple of toe-rings; skills had improved and could design certain project types pretty well but had recently butted heads with another manager in the office over some building code interpretations.
  • IT/CAD Management Staff, 36: was very knowledgeable at many drawing and modeling software platforms and could solve problems over the phone without even seeing someone’s computer screen; could be prickly and even obstinate when he perceived that an employee would not learn from their mistakes or listen to his directions; once told the senior management that he would no longer help drafting staff members who would not listen to and learn from his solutions.
  • Architect, 32: was a talented designer and was very skilled at running a project and working through construction detail problems; had a history of bipolar-like and histrionic behavior (throwing fits and acting very defensively at the slightest provocation or question, insisting that he had special privileges that no one else in the office had, insisting that he had or had not said something when the opposite was in fact true)

Admittedly, these people aren’t here on this blog to defend themselves, but what I am recounting are the reputations that these people had in the firm at which they worked, whether or not these reputations were honestly earned. To some extent, perception is reality, my people, and if the perception about you is that you’re hard to work with, you’ve either got to fix that or go work somewhere that your personality type and behavior aren’t seen as odd.

            And again, remember that a) not all the people let go in Round 3 had anything wrong with them—their project may have ended or there just wasn’t enough to keep them busy, and b) the difficult people let go in Round 3, despite their personal or professional shortcomings, were overall good at their jobs.  When there’s enough work to go around, certain idiosyncrasies and proclivities can be overlooked, but when things are tight a firm no longer has the resources to keep these people on.  The team you keep close when cash and morale are low has to be a tight, cohesive, and amicable team.  Hence, the firm shucks off anyone who might upset things.  They don’t need anyone around who wants to rock the boat—just the people who want to row.

            Round 4 hurts, and I mean hurts.  In Round 4, the people that get laid off are really good people.  There are no complaints about these people, no problems whatsoever—it’s just that there’s not enough work to go around.  Maybe those who get laid off in Round 4 were working on projects that went on hold, or their project wrapped up and there was nothing new to put them on.  Whatever it is, no one likes to see these people go.

            Anything after Round 4, which we’ll call Round 5+, means danger.  The company is going under, or best case scenario the economy is just really, really in the toilet.  My office had a Round 4 in the late fall of 2008 and a Round 5 in early spring of 2009, ad we lost some really good people in those rounds.  Being included in Round 3 and after is nothing you should take personally, and even if you’re in Rounds 1 and 2, don’t take it too personally.  You may just not have been a good fit, and this was a good opportunity to do some thinning.

 So what does this mean?

            What does all of this mean for the average intern?  First and foremost, remember that when it’s time to call on your relationships and your resources, it’s too late to build them. Stay professional and cordial at all times.  Second, once it appears that Round 2 is going on, get your resume and image sheet in order.  Regardless of how business is and how the economy is going, you should update your resume and image sheet once a year.  Don’t worry if you don’t do this—even the most disciplined architects don’t usually do this, but if you’re just starting out in the profession, now’s a good time to develop that habit.  Third, start creating a cushion of cash.  Decrease what you put into your 401(k), forego a few lunches and evenings out, and start socking away $100 or so per paycheck just in case you get laid off.  If you get a severance check, it my be a few more weeks before your first unemployment check comes, so you may need an extra cushion to tide you over and keep the lights on.

            If you do get laid off, just breathe…and don’t say anything nasty, accusatory, or snide in your exit interview.  Do ask politely about why you’re being let go.  If it’s about the economy plain and simple, and (this is a big and) you really like where you work, ask about working part time for six months instead of being laid off.  If you can’t stay on part time, ask about if your position will be open when things pick up again, and if so might you be able to get it back.  Also, depending on how long you worked there or under what circumstances you took the job—did you just move halfway across the country, only to be laid off less than a year after you moved?—you may be able to negotiate for a little extra severance.  Meanwhile, file for unemployment and/or start looking within the week for new employment.  From my firm, I found out that people who were let go in Rounds 1 and 2 (in the first half of 2008) were able to find employment in their fields with salaries comparable to what they made at my firm within four to eight weeks.  People let go in Rounds 3 and 4 have been less successful in those efforts.  Rounds 3 and 4 happened further into the economic crisis of 2008, so there were now fewer positions open for the pool of employees hitting the market.  Some of the folks who were part of Rounds 3 and 4 at my firm found work shortly—most of those people were licensed architects.  A couple others started their own firms, doing small residential remodeling projects.  Others had to settle for jobs not in their field.

            Bottom line on layoffs: this too shall pass.  The economy will come back, projects will come back, and jobs will come back.  It stings, and it's stressful, but it's nothing personal, my people: it’s just business.

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