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Layoff 101: Don't Blame Yourself

MICHEL MARTIN: I'm Michel Martin, and this is TELL ME MORE from NPR News. Now it's time for our weekly conversation about personal finance - one of our money coach conversations. We've been hearing that the economy is slowly but surely picking up, which means that finally people are getting hired again. But in some industries, people are still getting laid off. And unfortunately, we know a little bit about that ourselves.

So we thought it might be time to hear the basics of how to handle a layoff - in other words, layoff 101. And if you've ever been laid off, then you know you have all kind of concerns - financial ones, of course. But research shows that the experience can also take a toll on mental and physical well-being. But studies show there is hope if you have the right attitude. Here to tell us more is Sandra Sucher. She is professor of management practice at The Harvard Business School, and she's been studying the effects of layoffs. And she's with us now from Boston. Professor, thanks so much for joining us.

SANDRA SUCHER: And thank you for having me, Michel.

MARTIN: You know, now, we often hear about, like, specific life events being particularly stressful, right? Like moving and things of that sort - you know, the death of a parent. Among life events, how stressful is a layoff? How impactful can it be on a person's life?

SUCHER: Researchers have been looking at the effects of layoffs on individuals for more than 20 years. So we've got lots of data now that tells us what this is like for individuals who go through it. And just from a mental health standpoint, there was an analysis of over a hundred public health studies between 1990 and 2009. And what they found is that employees have double the risk of developing depression. They have a quadruple risk of an increase in alcoholism. They have an increased risk in committing violent acts, including acts against members of their own family, and they also have the risk of committing suicide. So, you know, this is a very, very difficult experience to overcome. And it's a very hard thing to live through.

MARTIN: There is of course the immediate impact, but those effects on your psyche can last for a very long time. In fact, you worked with your colleagues and some students at the school - at The Harvard Business School - on a project in which you interviewed a lot of people affected by layoffs. I just want to play a clip that you provided for us of a man named Bill Sankey (ph). He's an IT professional who's been laid off several times over the course of his career, and this is what he had to say.


BILL SANKEY: The residual effect that I've got from my past is that every day I go to work, and on my way to work, I start thinking, you know, this could easily be my last day.

MARTIN: Wow, that has to take a toll.


MARTIN: That has to take a toll on a person. Wheel around and tell us what are some of the things that help people recover from this experience or cope with this experience. Have you found some threads?

SUCHER: Actually, the research would suggest that your attitude matters the most. That's sort of a hard message to deliver when we've just read all these statistics. But, you know, employees who've been laid off were tested for how emotional they were at the time of the layoff, over time and who they blame for the layoff. What the researchers found was that the laid-off employees who had strong negative - the strongest negative emotional reactions to being laid off or who blamed themselves severely for the layoff, had a harder time recovering. And they would tend to seek out stress-relieving activities, like seeking emotional support from family and friends, rather than engaging in problem-solving activities like finding a new job. The researchers found that employees with a more optimistic outlook were also more likely to engage in behaviors that led to being reemployed.

So your attitude matters a lot. And I guess the message I would give, in terms of a tip, is don't blame yourself or doubt your own abilities. What distinguishes a layoff from being fired for poor performance is that companies use layoffs because of conditions inside the company itself. So they may have a need to cut costs due to a falloff in demand as we saw in the great recession we just lived through. They may need to increase efficiency and substitute some capital equipment for labor. They may need to restructure, to divest themselves of businesses that they're no longer going to be able to be successful in. These are things that sit within the company itself. It doesn't have to do with the quality of performance of the people who were doing the jobs in those areas. Really, it's all about them, and it's not about you.

MARTIN: One of the other things, I think - the intriguing findings that a number of people have discovered in recent years as this - unfortunately, this kind of - these difficult economic conditions have persisted in this country is that the longer people are unemployed after a layoff, the harder it is to find work. Why might that be? Are employers holding people's status against them, for having been unemployed for a while? What's up with that?

SUCHER: Yeah, you know, it really is true, Michel, that there is quite a lot of evidence of stigma associated with being laid off despite how unbelievably persistent and numerous layoffs have become. And in fact, in January of 2014, President Obama got together with the heads of some of the largest U.S. companies to persuade them to sign on to new business practices that would stop discriminating against the long-term unemployed. The theory, if there is one on the part of the company, is that your skills have grown rusty. If you had actually tried harder, you would have a job by now. And these things just aren't necessarily true of any individual.

MARTIN: Speaking of, you know, attitude on the other side of it, I wonder whether if people who've been laid off for a while are selling themselves short. I just want to play another clip from one of the interviews that you provided to us. This is Kelly White (ph) who was laid off from a job in printing. Let's listen.


KELLY WHITE: Until the day I die, a broom will fit my hands. Can I sweep a floor? Yes, I can. Will I? I sure will. If I have to to make ends meet, I'll do it. Do I want to do more than that? Yes, I do, not out of pride, but out of a sense of proper stewardship for my skills and abilities.

MARTIN: What are you hearing in this clip?

SUCHER: When Kelly White talks about a proper stewardship of her skills and abilities, what she's saying is that she wants a job that is equal to as good and effective a worker as she is. In our interview with her, she was marvelous. She talked about liking to do things - manual dexterity was something that pleased her greatly. And when she was done with the printing work that she did, she loved looking at the layup that she had created. And she said she got huge satisfaction from her ability to do a job well. So I think that Kelly is the kind of person who has a very strong sense of who she is, what she's good at and she wants to keep that.

MARTIN: So what's the take-away here? Obviously this is a very rich subject, and we've just kind of scratched the surface here. So what's the take-away here? Is - first of all, take it seriously - that being laid off is a profound event and that it does hurt. But then, what? Go and what?

SUCHER: So one of the things that's - that really is the best way to treat a layoff is to frame it from a problem to an opportunity. And what I mean by that is to really try to think very hard about the kinds of things that you like to do - to explore alternative career paths. What are you really passionate about, and what are you good at? So there's one terrific exercise I was once asked to do by a career coach, who said that I should interview four people who knew me well and have them only talk about my strengths. I had a better sense of who I was, what I was good at, what was important to me than I would've had if I had just thought about these things by myself.

We interviewed a guy who had been an aerospace executive, and after reflection and thinking about his life and talking to people, he decided to become a pastor. Now, you know, this kind of story doesn't happen for everyone, but that attitude of proper stewardship of your skills and abilities - keeping faith in yourself and being willing to really explore what it is that you might want to be doing with your life - I think that that's one way in which this very, you know, terrible event to an individual can turn into something that might have some positive outcomes for you in the future.

MARTIN: Sandra Sucher is professor of management practice at The Harvard Business School. She's been researching the effects of layoffs on workers around the country, and she was kind enough to join us from Boston. Professor, thanks so much for joining us.

SUCHER: Oh, my pleasure. Transcript provided by NPR, Copyright NPR.