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Federal workers wonder what’s next after mass layoffs<\/p>\n
From wildfire resiliency to helping local farmers: What’s at stake with mass layoffs<\/p>\n
You\u2019ve been offered a buyout. Your employer wants to pay you to quit. It\u2019s a big chunk of change.\u00a0<\/p>\n
But leaving your job now would mean searching for a new one in a weakening job market<\/a>.<\/p>\n Should you accept the offer?\u00a0<\/p>\n Companies offer buyouts to thin the ranks, spending money in the short term to save money in the long run.\u00a0\u00a0<\/p>\n Employers often leverage buyouts to avoid layoffs in a shaky economy.\u00a0And that thought, alone, should give you pause.\u00a0<\/p>\n The Trump administration offered buyouts<\/a> to the entire federal workforce this year, aiming to reduce it by as much as 10%. Roughly 75,000 workers accepted<\/a>.\u00a0More recently, Amazon<\/a>, UPS<\/a> and Target<\/a> all announced private-sector layoffs. \u00a0<\/p>\n Buyouts can sound tempting. A five-figure severance package might be the most money a worker has ever seen in one paycheck. But it\u2019s also the last paycheck your employer will give you.\u00a0<\/p>\n \u201cIt\u2019s like lottery winners. Some people think the money lasts longer than it does,\u201d said Donna Walton, wealth strategist at TD Wealth.\u00a0<\/p>\n If you are mulling a buyout, some considerations are universal: How large is the severance package? Am I close to retirement? Did I want to leave that job anyway?\u00a0<\/p>\n But the current economic climate presents its own challenges.\u00a0\u00a0<\/p>\n Employers added only 22,000 jobs<\/a> in August, according to the latest federal report. Unemployment ticked up to 4.3%, its highest level since October 2021.<\/p>\n Nearly 2 million Americans have been out of work for six months or longer<\/a>, the Labor Department reported in May, the largest number in more than two years. Companies are doing less hiring out of uncertainty about President Trump\u2019s tariffs<\/a>. Artificial intelligence is swiping jobs from new graduates.\u00a0Recession fears<\/a> loom.<\/p>\n \u201cIt is a very soft job market,\u201d said Michele Evermore<\/a>, a senior fellow at the National Academy of Social Insurance, and a former Labor Department official in the Biden Administration, speaking to USA TODAY earlier this year. \u201cIt\u2019s such a period of economic uncertainty, I think people are hanging onto their jobs.\u201d\u00a0<\/p>\n Here are five tips for employees who are thinking about taking buyouts in 2025.\u00a0<\/p>\n Ask for a buyout\u00a0<\/p>\n Let\u2019s start with a proactive step. Maybe your employer hasn\u2019t offered a buyout. But you\u2019re restless to make a change, and you\u2019ve heard your company wants to cut costs.\u00a0<\/p>\n Consider approaching your managers and asking for a buyout. In many cases, there\u2019s nothing to stop an employer from creating a voluntary severance package just for you.\u00a0<\/p>\n \u201cYou do see these things happen, particularly if there\u2019s news that a company is planning on downsizing,\u201d said Michael Scarpati, CEO of RetireUS<\/a>, a financial wellness platform. \u201cIt\u2019s kind of a win-win for both parties.\u201d\u00a0<\/p>\n If you\u2019re the first to ask for a buyout, you may get a better severance package than the one your employer eventually offers everyone else.\u00a0<\/p>\n But don\u2019t ask for a buyout if you aren\u2019t ready to take one.\u00a0<\/p>\n \u201cYou have to be willing to leave if they do offer it to you,\u201d Walton said. \u201cIt\u2019s not something you want to bluff about.\u201d\u00a0<\/p>\n Negotiate the buyout terms\u00a0<\/p>\n A typical buyout<\/a> might offer four weeks of pay, plus another week for every year you\u2019ve worked at the company. You might get extra health insurance coverage, even help in finding a new job.\u00a0<\/p>\n Roughly half of workers accept buyout offers without negotiating, AARP reports<\/a>. But it can\u2019t hurt to ask for better terms.\u00a0<\/p>\n \u201cThink of it as if you\u2019re going in for a job interview,\u201d Scarpati said.\u00a0\u00a0<\/p>\n You could ask for a full year of severance pay, rather than a few months. Perhaps your employer will cover the costs of health insurance while you look for a new job.\u00a0\u00a0<\/p>\n Some workers hire attorneys to negotiate buyouts, said\u202fDavid John<\/a>, a senior strategic policy adviser at the AARP Public Policy Institute.\u202f\u00a0<\/p>\n That might sound extreme, but remember: A buyout is a business proposition. The contracts can be complicated, sometimes including non-disclosure agreements or non-compete clauses.\u00a0\u00a0<\/p>\n Even if you don\u2019t bring a lawyer to a buyout negotiation, Walton said, \u201cyou should at least meet with one.\u201d\u00a0<\/p>\n Test the job market\u00a0<\/p>\n Unless you\u2019re planning to retire, experts say, you should gauge your chances of finding another job before you leave your current job.\u00a0<\/p>\n If you work in a shrinking field, or in an economically afflicted region, you may already know it.\u00a0\u00a0<\/p>\n \u201cIt\u2019s a pretty different thing to take a buyout in D.C. if you work in a thinktank, or to take a buyout if you work on an oil rig in South Dakota,\u201d Evermore said.\u00a0<\/p>\n Look at Labor Department jobs reports, Evermore said, to find out how many people are applying for unemployment insurance<\/a> in your area, and how many are lingering on the benefit rolls.\u00a0<\/p>\n Better still: Apply for some jobs. See if you get bites. If not, that might be a good sign a buyout isn\u2019t for you.\u00a0<\/p>\n In the best-case scenario, you can line up a new job before you take the buyout.\u00a0\u00a0<\/p>\n Gauge the risk of layoffs\u00a0<\/p>\n Many employers offer buyouts to avoid layoffs, or at least to delay them.\u00a0\u00a0<\/p>\n If you have a buyout offer, weigh the odds that the company will resort to layoffs once the buyouts are past.\u00a0\u00a0<\/p>\n \u201cA responsible company will address those worries right off the bat, and say yes or no,\u201d said John of AARP.\u00a0<\/p>\n If layoffs are likely, think about whether you might land on a layoff list. Ask your manager if you are vulnerable.\u00a0<\/p>\n If your company has endured layoffs in the past, look at the severance packages those workers received.\u00a0\u00a0<\/p>\n In some cases, Walton said, a buyout package might be \u201cthe same thing your company offers you if it lays you off six months from now.\u201d\u00a0<\/p>\n Take your time\u00a0<\/p>\n