Redundancy and career change

The value of supporting workers facing redundancy or career changes 

Emerging workplace trends mean a ‘career for life’ is no longer relevant for many workers. Career changes can arise due to involuntary job loss like redundancies or workplace changes (e.g. workforce downsizing, restructuring, closures, changes to the skills required for the role or other workplace changes). 

Or a career change can be self-directed (e.g. moving to a new industry or profession). Indeed, self-directed career changes are becoming more common, often prompted by job satisfaction, pay considerations, changing values or circumstances, new interests or a desire for growth. 

Workers experiencing a career change can face a range of challenges, depending on their circumstances. Involuntary job loss can be particularly challenging.  

Types of challenges associated with career changes include: 

• Financial challenges are a major stressor, with displaced workers experiencing persistent earning losses even after re-employment. 
• Psychosocial factors such as loss of social connections, loss of identity and changes to routines and a sense of purpose, and stigma associated with unemployment also contribute to poor mental health following redundancy. The mental health of family members and relationships can also be affected. 
• Men and people with blue-collar jobs tend to experience more distress than women and people with white-collar jobs.  
• The mental health impacts of a self-directed career change tend to be influenced by the reasons motivating the change. When we perceive we are in control and desire the proposed change, the impact on our mental health is likely to be positive. However, some still may experience fear of failure and the unknown, insecurity and concerns about making a poor decision, and anxiety related to perceptions and expectations of others. 

What organisations can do to support workers experiencing a career change 

Given the prevalence of redundancies and increase in self-directed career changes, it is important for organisations to consider how they understand, support and respond to these transitions. 

Here is how your organisation can support workers experiencing a career change transition: 

Offer career education and counselling services and mentoring programs, to help people manage expectations about career changes. 

• Help workers upskill so they are more competitive in the job market.  
• Offer assistance with resume and job interview skills. 
• Upskill management to understand their role in career transitions conversations and build skills and confidence of managers to support workers through this transition. 

During periods of organisational change: 

• Recognise that employers have legal requirements to consult with workers about major changes in the workplace. 
• Build open transparent communication and trust in the workplace (e.g. sharing the nature of changes, reasons for the change, and how and why decisions are made). 
• Ensure your redeployment process identifies and matches impacted workers to any current roles. 
• Offer voluntary redundancies as a first option, to help reduce the need for involuntary displacement, if possible. 
• Support positive exit rituals when individuals leave an organisation, including a formal farewell, so individuals can say goodbye to colleagues, where possible. 
• Depersonalise language regarding role changes (e.g. a role is made redundant, rather than a person made redundant).  
• Support remaining workers, who can experience ‘survivor syndrome’ (feelings of guilt, anxiety, apathy and disengagement), or ‘survivor sickness’ (denial, job insecurity, feelings of unfairness, fatigue, reduced risk taking, decreased motivation and distrust). 

Be open about how and why your organisation is restructuring. If possible, offer voluntary redundancies first. And don’t forget to support remaining workers. 

What people can do when changing careers 

Research shows 5 psychological factors can influence the experience and duration of disruption associated with a career change (whether it is voluntary or involuntary): readiness, confidence, control, perceived support and decision independence. 

Here is what you can do to boost these factors when you embark on a new career: 

• Make use of career transition support, which can help with searching for re-employment, retraining or relocation for better job opportunities. 
• Seek social support from family and friends including former colleagues. 
• Access financial assistance. 
• Engage with an unemployment community program. 
• Use an Employee Assistance Program, if possible. 

The financial effects of a career change or redundancy may be the most obvious. But don’t underestimate the social effects—loss of social connections, changes to routine and a lost sense of purpose. Family, friends and even former colleagues are really important supports.