Kat McGlynn, a 40-year-old former employee of an environmental nonprofit in New York City, found herself unexpectedly laid off in August 2022 after more than a decade with the organization. The sudden job loss hit her hard, not just financially but emotionally, leaving her grappling with self-doubt and anxiety about how to explain the situation to future employers. "I stressed over perfecting my explanation so it wouldn’t come off as a red flag," she admits. And she’s far from alone—nearly half of Americans report anxiety tied to layoffs, according to career site Zippia. While layoffs are increasingly common (40% of workers experience at least one in their lifetime), the emotional fallout—shame, insecurity, even identity crisis—can linger long after the initial shock wears off. The pandemic only amplified this, with 28% of layoffs occurring in the last two years alone. Yet despite heightened awareness of workplace mental health, the psychological toll of job loss remains underdiscussed. Here’s how to navigate the storm, rebuild confidence, and even leverage the experience for growth.
The Stigma Isn’t What It Used to Be
McGlynn braced for awkward interviews where she’d have to defend her layoff—but to her surprise, most recruiters didn’t even bring it up. "When it did come up, the questions felt almost outdated, like they were following an old script," she says. Career coach Mandi Woodruff-Santos, founder of MandiMoney Makers and cohost of the Brown Ambition podcast, confirms this shift. She works primarily with women of color who internalize layoffs as personal failures. "The narrative around layoffs has changed," she explains. "With so many companies restructuring—often due to leadership missteps, not employee performance—hiring managers get it." She advises clients to reframe the experience: "Say, ‘My department was eliminated during restructuring,’ and pivot to what you learned. No apologies." The key? Detaching self-worth from the layoff. Easier said than done, but critical for moving forward.
Grieving the Loss (Yes, It’s OK)
A layoff isn’t just a financial hit—it’s a legitimate loss that can trigger grief akin to a breakup or bereavement. Dr. Natalie Dattilo, a clinical psychologist specializing in workplace mental health, compares it to the five stages of grief: denial ("This can’t be happening"), anger ("How could they?"), bargaining ("If only I’d…"), depression ("I’ll never recover"), and eventually acceptance. "Suppressing these emotions prolongs the healing process," she says. Instead, she recommends structured reflection: Write a "breakup letter" to your old job to process feelings, or list what you’d change about the role to identify non-negotiables for your next position. Physical activity also helps; studies show exercise reduces cortisol levels, counteracting the stress spiral. One laid-off tech worker, who asked to remain anonymous, took up kickboxing: "Punching something was cheaper than therapy."
Rebuilding Your Narrative
After the initial shock, the question becomes: How do you talk about this gap without sounding defeated? Woodruff-Santos suggests scripting a concise, neutral explanation—e.g., "The company downsized 30% of staff"—then redirecting to skills gained or new certifications pursued during the transition. McGlynn used her time off to complete a sustainability leadership course, which became her interview talking point. "I’d say, ‘The layoff gave me space to level up in XYZ, which I’ll bring to this role.’" For those struggling to spin positively, career coach Peter Yang recommends the "STAR" method (Situation, Task, Action, Result) to reframe the experience. Example: "When my startup folded (Situation), I led a task force to document processes (Task). I streamlined our knowledge-transfer system (Action), which cut onboarding time for acquirers by 40% (Result)." This turns a perceived setback into proof of adaptability.
The Financial Stress Double Whammy
Money worries compound emotional strain, especially without severance. Certified financial planner Shannah Compton Game, host of the Millennial Money podcast, urges immediate triage: "File for unemployment today—delays cost you." She advises clients to contact lenders about hardship programs (many offer temporary payment pauses), slash nonessentials (streaming subscriptions, meal kits), and explore gig work like freelance projects or Rover dog-walking for cash flow. "Even $500/month buys breathing room." For long-term planning, she suggests treating severance like a salary extension: "If you get four months’ pay, pretend you’re employed for four months. Aggressively job-hunt, but with structure—say, 10 applications/week." One of her clients, a laid-off marketing director, drove for Uber Eats while upskilling in Google Analytics. "It kept her afloat mentally and financially until landing a higher-paying role."
Networking When You Feel Like Hiding
Isolation amplifies post-layoff despair, yet many withdraw out of embarrassment. LinkedIn guru Andrew Seaman, senior editor for job search at the platform, insists outreach is crucial: "People want to help, but they can’t if you vanish." His rules: 1) Update your profile before announcing the layoff (use the "Open to Work" banner discreetly); 2) Message contacts with specific asks ("Do you know anyone in SaaS sales?" vs. "I need a job"); 3) Attend virtual events—low-pressure ways to rebuild confidence. One introverted data analyst shared on LinkedIn about losing her job due to AI restructuring. The post went viral, leading to interviews at IBM and Microsoft. "Vulnerability humanizes you," Seaman notes. Still hesitant? Start small: Comment on industry posts to regain your professional voice.
When to Seek Professional Help
If depression persists beyond two months—sleep disturbances, loss of interest in activities, hopelessness—it’s time to consult a therapist. Dr. Dattilo warns that prolonged stress can manifest physically (migraines, digestive issues) and cognitively (brain fog, memory lapses). Many employers extend EAP (Employee Assistance Program) benefits post-layoff, offering free therapy sessions. Online platforms like BetterHelp or Open Path Collective provide sliding-scale options. Support groups also help; organizations like Layoff Lifeline host virtual meetups where members share coping strategies. "Hearing others’ stories normalized my experience," says a former retail manager who landed a new job after six months. "I realized I wasn’t ‘behind’—I was on my own path."
McGlynn’s layoff, while painful, ultimately led her to a director role at a climate-tech startup with a 20% salary bump. "I’d never have pursued this level without the push," she reflects. The silver lining? Post-layoff resilience often reveals untapped strengths. As Woodruff-Santos puts it: "Survival rewires you. You’ll enter your next role with sharper instincts—about companies, about yourself." The goal isn’t to "get over" the layoff but to integrate it as a chapter, not the whole story. After all, in today’s volatile job market, the real edge goes to those who’ve learned to bounce back.
