Redundancies can be fresh new beginnings, too
If success is the best revenge then landing a higher paying job after being made redundant is pretty sweet.
Life gets even better if the new job comes along while you still have most of your redundancy payment intact.
A survey of white-collar workers made redundant last year found 41 per cent ended up finding a new job that paid more than the role they lost.
Right Management commissioned the research that involved 526 people who had completed one of its career transition programs. Held between January and December 2011, the programs lasted anywhere from a month to a year and were all paid for by a soon to be ex-employer.
Of those surveyed, 40 per cent found a more senior role and 21 per cent moved into a job at the same level as the job they held pre-redundancy. Overall, while 41 per cent of the survey group found jobs that paid more than their pre-redundancy job, 21 per cent stayed at the same pay level while 38 per cent took jobs that paid less than their former job.
The Right Management survey didn’t actually spell out the reasons for the salary decline but did find 46 per cent of participants changed industries post redundancy and 53 per cent changed job functions. Either step could involve a salary dip.
The head of Right Management’s Career Management Practice Tim Roche also points out that many of the participants were from the finance sector where salaries are so much higher than many other sectors so a move could well mean a pay drop.
Redundancies will continue in Australia but there is hiring activity too and salary levels appear to be holding steady for now.
Roche says Right Management doubled its outplacement activity between December 2011 and January 2012 and forward bookings reveals a busy time lies ahead at least until June.
Meanwhile, according to the newly released Manpower survey, 24 per cent of Australian employers plan to hire over the April to June quarter while 11 per cent plan to shed jobs.
To make things a little trickier, just because an employer is job shedding doesn’t mean they’re not hiring as well.
Banks are good example. While they are sending many roles off shore they are creating new types of roles in house too.
At a Robert Walters salary briefing two weeks ago, IT specialist Peter Bateson told me banks were hiring digital talent to do creative work they once sent out to agencies.
In one specific instance a bank is hiring game developers on contracts of $1,000 a day to create a game that appeals to young customers. I’ve written more about salary trends on my blog.
Roche agrees that banks are creating new roles to take on tasks such as developing their online transaction capabilities and to replace legacy IT systems with more agile systems.
The hiring activity in other sectors is well known – manufacturing and retail down, mining and resources and now IT up.
Whatever the scene here, the UK is far worse off according to data released in the last two days.
According to Chartered Institute of Personnel and Development research, more than 65 per cent of people made redundant in the UK accepted less salary to land a new job.
The CIPD reckons nearly 2.7 million people have lost jobs in the UK since 2008 and employers have shelled out £28.6 billion in redundancy and other costs. I don’t have equivalent figures for Australia.
Of those who lost jobs in the UK, two thirds took an average pay cut of 28 per cent to secure a new job.
The CIPD says the climate of fear in the UK has made workers reluctant to ask for money. Experts say British banks in particular are taking advantage of current conditions to bring down salaries that sky rocketed in the good times.
In just the last few days Lloyds and Royal Bank of Scotland alone have announced plans to shed 1,700 jobs between them so any bank wanting to hire new staff doesn’t have to look far to find plenty of people vying for the one job.
So what can you take away from all this?
A redundancy is not the end of the world and could well be the beginning of a new and potentially better career.
Don’t get ripped off when it comes to negotiating a new salary but update yourself on the current market rate for your role so you don’t pass up what has become a reasonable offer.
That doesn’t mean you should take just anything but you might need to be flexible. Contract if you don’t want to take a permanent job at a lesser salary level or use outplacement to move to something new where demand is growing.
There is no wrong or right strategy post redundancy but only what is right for you given your family and financial commitments.
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