If you’ve been freaking out about retrenchment thanks to the impending recession, well, things aren’t going to get better anytime soon. Companies like Shopee and Crypto.com are already cutting back on their staff here in Singapore as companies brace for the economic downturn.
While the opinion is split on when the economic recession will be here, our Prime Minister Lee Hsien Loong, had stated in his May Day Rally that Singapore could potentially enter a recession in the next two years.
Since there aren’t many unemployment benefits mandated by the government, it means that if you get retrenched, you’re likely to be on your own.
So before anything bad can happen (touch wood!), it’s a good idea to take these steps to protect yourself, should the worst occur.
1. Ensure you have a larger emergency fund
If you get retrenched and you don’t have an emergency fund or adequate savings, you’re in big trouble. This is a situation that could see you swiftly fall into crazy debt that might haunt you for years even after you do manage to find another job.
While according to traditional wisdom your emergency fund should contain 3 to 6 months’ of your monthly expenses, if you’re at high risk of being retrenched (particularly if you’re in the fintech space), it’s a good idea to aim for the high end of that scale, or even bump it up to 12 months’ worth.
That means that even with 6 months’ worth of monthly expenses saved up, there’s an almost 50% chance you’ll run out of money before you find another job.
You want to make sure when calculating your monthly expenses that you factor in the cost of everything from utilities bills to insurance premiums and beyond. Basically, every single thing you spend on should be included, unless you intend to cut off your electricity and live in darkness or shower in rainwater till you get a new job.
2. Ensure you have passive income streams
If your job is your only form of income, once it gets cut off you’ll be desperate. Finding other streams of income gives you a lot more security in the face of retrenchment.
One way of obtaining a passive income stream is to take on a side job like giving tuition, maintaining a small business or doing freelance consulting or other work outside of your regular employment.
But that takes a lot of effort, which turns off people whose lives are already so consumed by work that they don’t actually have free time.
Luckily, there are other ways to earn passive income, especially if you’ve been working for some time and have investments or property. Investment income like stock dividends are a popular way for mid-career professionals or retirees to earn some extra cash, as is renting out a room in their homes.
3. Take every opportunity to upgrade yourself now
There might have been a good reason you were retrenched—your current job was becoming obsolete or your skillset had failed to keep up with the times. Unless something changes, you’re not going to get reemployed that easily.
It is important to start retraining yourself the moment you start feeling insecure about your job or get wind of a possible retrenchment, as the longer you wait the harder it is to get back into the industry, since a long gap of unemployment sends a message to employers that you’re now out of touch.
To know in which direction you should be upgrading yourself, it can be helpful to look at the skillsets of younger employees in your company. These are the people who will be taking over your work when you’re gone, and who have the benefit of being more in tune with the latest developments in the market than you are.
For instance, the job scope of executives in marketing today often requires a strong understanding of digital marketing, social media and SEO.
If you’ve been in marketing for more than a decade, this may be an area you struggle with, but you can bet your bottom dollar that all those young upstarts fresh out of uni are going to begin honing their proficiencies in digital the minute they enter the working world.
4. Keep your business networks fresh
While there is a plethora of job portals available for job seekers now, sometimes a word-of-mouth referral gets you a job quicker. So, it’s worthy to keep your business networks fresh by catching up with friends within the same industry once in a while.
One easy way to connect with people in your industry could be to use LinkedIn to share articles, like people’s posts and chat with them there.
It need not be limited to business networks either. Keeping in touch with a friend, a cousin, a relative, or an acquaintance could open new doors when you really need it.
5. Start going for interviews
Even if you had hoped to stay in your current position for the long-term, if you are at risk of losing your job, it could benefit you to stay aware of what opportunities lie out there and start going for interviews.
Going for interviews hones your communication skills and gives you a head-start should you really get retrenched. Usually, interview processes can take months, so it’s not a bad idea to start early.
If you don’t land a job through such interviews, that’s part of the process. The upside is that you would have gain some insights about the interviewing company.
If you do discover a career opportunity that could be a good fit, the ball’s in your court.
In other words, don’t sit still. What are you doing to guard against unemployment and retrenchment? Tell us in the comments!