What Is Outplacement?
If you’re new to outplacement, you likely have a lot of questions about it. What is outplacement? Who is it for? How can it help my company? Read on for answers to these and other frequently asked questions.
In the age of social media and employer review sites, the employee-employer relationship has changed tremendously. Gone are the days when employees stayed with an employer for decades, building their careers within a single company. Today, people switch jobs often and publicly share their opinions about their employers on Glassdoor, Facebook, and Twitter, especially when exiting the company.
This has made company transitions, such as layoffs and other involuntary employee exits, critical moments for companies concerned about brand protection.
To forestall negative ratings and reviews, forward-thinking companies seek to create a positive offboarding experience for affected employees so that they depart with a healthy attitude towards the company. Outplacement can play a key part in these efforts.
Learn more about our outplacement solution.
What Is Outplacement?
Outplacement is an employee benefit provided by a company to workers who have recently been laid off. The service involves employers helping their exiting employees to find new work and transition smoothly back into the workforce.
Generally, a company will enlist the help of an outplacement firm to deliver such niche services, including but not limited to career coaching, resume help, and job search support to affected employees.
Although outplacement has always been used as a strategy to support employees, the way this service is provided has shifted significantly in recent years to meet companies’ changing needs.
When outplacement first emerged in the 1960s, companies typically offered career assistance primarily to executives and upper-level employees, providing them with a satellite office, phone and assistant to aid in looking for employment. Today, companies seek to offer outplacement not just to a select few, but to all affected employees across every level of an organization. The aim is to better protect brand reputation and support the employees who have historically been underserved in times of transition.
In addition, in today’s digital age, employees have come to expect convenience from any service they engage with, and outplacement is no different. Modern outplacement services can offer coaching and resources that are easily accessible and on-demand through the click of a button.
Outplacement services can be used by companies who are looking to downsize, thinking about restructuring or making layoffs for monetary reasons.
Outplacement is for employees who have been laid off
The service can help them to find another job
It can protect your brand reputation during difficult times, such as during layoffs
It is for all employees at all levels of a business
What is outplacement counseling?
Outplacement counseling helps employees to assess their skills and identify their strengths, while also training them to market themselves to future employers. It is sometimes known as career coaching, and it can help your employees to find their next job more quickly. It is just one part of the overall outplacement process.
What is outplacement assistance?
Outplacement assistance involves making sure your employees are as prepared as possible for their next job search. It involves coaching them for interviews, improving or writing their resume, helping them network with relevant people, and navigate job boards to find their next role as quickly as possible.
What are outplacement services?
Outplacement services refer to the wide range of resources you can provide for your employees in the event of a layoff or reduction in force. Under the wider definition of “outplacement,” there are the following outplacement features you could offer to your employees:
- One-on-one career coaching
- Cover letter and resume-building tools
- Resume review, editing and writing
- Job interview practice and coaching
- Career interests and skills assessments
- Social media profile writing and optimization
- Guides on job search-related topics, such as networking and personal branding
- Access to information about target companies to support research
Different outplacement programs offer different services, and the quality of the programs can vary widely. When choosing an outplacement program, you should ensure that it is from a trustworthy and reputable company and that the program includes everything you require. For example, an outplacement program that offers one-on-one coaching with an experienced career development specialist and hands-on resume reviews by a professional editor is likely to be much more effective for the job seeker than a program that offers only group coaching with generic job search advice.
INTOO outplacement helps job seekers land new roles in an average of 10 weeks by providing keyservices, such as unlimited career coaching on networking, interview preparation and more, even on a weekend. We support HR leaders by providing a dedicated client success manager to oversee your account and support you and your team.
How does outplacement work?
If you were to offer outplacement in your business, how exactly would it work?
Outplacement services are a key part of building a supportive severance package. In addition to monetary and benefit components, outplacement services help guide your impacted employees forward to their next opportunity. Outplacement is provided by you as the employer, and isn’t something your employees should look for independently.
Once you’ve found an outplacement firm, you can expect to be able to roll the program out within days if the need is imminent. You will be assigned a client success manager, who will work closely with you and your leadership teams to effectively and compassionately roll out services to your impacted employees.
Employees should have the ability to immediately engage with career coaches from day one in order to jump-start their job search. Career coaches will be matched to each individual job seeker for personalized job search plan development and guidance. Traditionally, outplacement was offered in-person. But today, it’s important to find outplacement providers who are experts in virtual outplacement delivery for coaching and job seeker resources.
An outplacement provider should also deliver reporting to help you understand program ROI.
Why Is Outplacement Important?
There are four main benefits of outplacement; it can strengthen brand reputation, particularly during hard times, reduce business costs and help to create a positive company culture. These are some of the positive impacts it can have on your business. Most importantly, though, it provides career transition support for exiting employees at a time when they need it most.
Why invest in outplacement?
Employers view outplacement as an investment that yields many results:
- increases the likelihood of rehiring once laid-off employees
- protects employer brand and reputation
- mitigates the risk of litigation
However, as our recent Outplacement Survey revealed, the #1 reason that employers offer outplacement is the desire to do the right thing.
Stronger brand reputation
Layoffs are a vulnerable time for a brand. Exiting employees, if they feel they’ve been treated poorly, can publicly share their opinions about your company on Glassdoor and social media. In fact, INTOO’s Employer Branding Study found 66% of people choose to share their poor layoff experiences with others.
Offering outplacement to departing employees and supporting them at a challenging time in their careers can help prevent online backlash. If laid-off workers leave feeling that your company did its best to help them, you will be better able to mitigate long-term damage to your company’s reputation.
Reduce business costs
Brand reputation has a powerful effect on your bottom line. For one, a positive brand reputation attracts and retains customers, while a negative one repels them. Our Employer Branding Study found 64% of consumers have stopped purchasing from a brand after hearing news of that company’s poor employee treatment. Protecting your brand reputation with outplacement puts you in a better position to maintain and expand your customer base.
Brand reputation also helps you save money when recruiting employees. Harvard Business Review reports that when a company has a poor reputation, new hires come at an additional cost of $4,723 each. Moreover, since outplacement allows you to retain better relationships with exiting employees, your company will be in a better position to attract “boomerang” employees—those who return to work for your company at a later date.
Better company culture
During and after a reduction in force, it is critical for businesses to foster a positive company culture to encourage the productivity and loyalty of remaining employees. This is another reason why it is vital to offer outplacement to exiting employees, whom the remaining employees consider friends and colleagues. If departing employees report feeling supported by the company—and are able to land new jobs through an effective outplacement program—the remaining employees are likely to conclude that they work for a responsible and conscientious company that truly cares about its workers’ long-term wellbeing.
Outplacement offers key benefits that are of primary importance for any business organization. In fact, because outplacement’s value for the employer is so clear, many companies today offer outplacement solutions to outgoing employees at every level of the organization as a common practice.
But what are the benefits of outplacement for the employee?
They’ll receive one-on-one career counseling. One important benefit is one-on-one career counseling, which matches job seekers with professional career coaches. These coaches can provide advice on everything from conducting an effective job search to negotiating a competitive salary. In addition, many job seekers benefit from hands-on resume reviews and interview coaching by career development professionals.
To select the most effective outplacement program for your company, consider the needs of your workforce alongside the success rate of the outplacement firm that will provide the services. You’ll want to choose a firm that has a proven record of helping users of its program find new jobs quickly, and consequently, boasts a high user satisfaction rating.
History of outplacement
When outplacement emerged in the 1960s, companies typically offered career assistance primarily to executives and upper-level employees, affording them the trappings of a familiar work environment—a satellite office, a phone, and an assistant—to aid in looking for employment. In the 1990s, full-time consultants became a common added service.
These two offerings—the “brick-and-mortar” provision of a satellite office and one-on-one or group coaching—continue in outplacement today and have defined the scope of services for the past five decades. But times have changed; organizations face new challenges, but also benefit from new advantages of a modern labor market. Outplacement service features should match the needs of today’s job seekers with on-the-go and remote, at-home career coaching and innovative job seeker technology.
Drawbacks of outplacement
While outplacement benefits are valuable, some companies may hesitate in investing in the service due to the cost and the desire to save on further expense during times of organizational change. In these cases, it’s helpful to keep in mind the many ways outplacement programs can save your company money. By reducing litigation, lowering cost per hire, and improving customer and employee retention among your remaining employees, an outplacement program often provides a high return on investment.
Moreover, companies today have the option of choosing virtual outplacement programs, which are generally more affordable for employers. INTOO’s cost-competitive outplacement program, for example, offers personalized career transition services such as unlimited one-on-one career coaching, hands-on resume review, and innovative job seeker tools and resources, helping people land jobs two and a half times faster than the national average.*
*Based on the national average duration of unemployment in January 2021. Source: Bureau of Labor Statistics.
Outplacement Cost And Other Factors
Not all outplacement firms are created equal. Before selecting one, make sure to evaluate the outplacement program against your company’s specific requirements. The cost of service is important to consider, of course, but investing in a cheap program that doesn’t meet your workforce’s needs will still be money poorly spent. Here are the main questions to ask when choosing an outplacement program.
Are the career transition services offered by this outplacement program the types of services that will be useful to your workforce? Does the program offer individualized services such as one-on-one career coaching and resume review, or does it take a one-size-fits-all approach, offering only a job board and generic career advice? Can the services be tailored for different types of employees, such as hourly workers or executives?
What is the length of the outplacement program, considering the fact that many people require significant time to find a job that best suits their talents? Can the length of service be extended at a reasonable cost for senior-level and executive employees who often take longer to find positions that match their skills and interests?
Does the outplacement firm have a strong record of success? Does it have experience providing executive outplacement as well as outplacement counseling to entry-, mid- and senior-level employees? Who are some past and existing clients, and what industries are they in? What is the landing rate for users of this outplacement program? What are the qualifications of the program’s career coaches?
Can users access the services at their convenience through a virtual platform, or do they have to go to an office to receive help? Do the virtual services offer personalized, premium benefits, such as one-on-one coaching with a professional career development expert, or hands-on resume review and editing? Does a virtual program offer more value per dollar spent than a traditional brick-and-mortar outplacement program?
Ultimately, your choice of an outplacement firm should take into account both your company’s financial resources and your workforce’s needs. Skimping on outplacement services can lead to low landing rates for your exiting employees—resulting in a low or negative return for your investment.
On the other hand, investing in an expensive traditional program that requires employees to commute to an office to access outplacement services and resources, like meeting with a career advisor, can mean paying high prices for services your employees may decide not to use due to a lack of convenience and accessibility.
An easy-to-use, tech-savvy solution like INTOO’s can address both issues, allowing you to offer premium, easily accessible services to your workforce at competitive costs for the company.
The future of outplacement
Because companies today see the importance of protecting brand image, outplacement is becoming a more standard benefit given to departing employees. Many business sectors already offer outplacement as a common practice. And today, these companies are more likely to extend outplacement programs not just to executive and senior-level employees, but to all employees, as employers recognize the importance of investing in exiting employees at every level and the impact it can have on employer brand after a layoff event.
This guide has included a lot of relevant information around what outplacement is, the services it includes, how it could benefit you and your company, how it can benefit your employees, and more. Below, you can find some key takeaways to remember:
- Outplacement benefits both employees and employers.
- By offering outplacement, employers can reduce costs associated with unemployment benefits, wrongful termination lawsuits, employee retention and recruiting, customer retention, and brand management.
- Outplacement firms must be carefully evaluated to give your workforce the career transition support it needs, and your company the brand protection it seeks.
- Virtual outplacement has grown in popularity due to its convenience, effectiveness, and affordability.