Style + Ask The Edit

CHS Careerist: Demotion or Dismissal

Dear Belle, 

This is a complex question, but I hope you can help me.  My supervisor pulled me aside yesterday and informed me that our department will be reorganized over the next few months.  She gave me a choice: be demoted to a job that pays $7,500 less (1/7 of my salary) or be dismissed with eight weeks worth of compensation.  

Working for this company has been good, but it’s not my dream job.  I’m thinking about taking the dismissal and trying to make a change, but all my friends keep telling me that that’s a dumb idea.  But I’m only 26 and I think that maybe this reorganization is a gift disguised as a setback.  What do you think?  

Casey

Given the state of the economy and the impact that budget cuts are having on public and private entities, this is a situation that I think a number of people can relate to.  However, it is also a very individualized question.  I don’t feel comfortable giving you an answer, but let me give you a few questions that you can ask yourself that might help you make the decision.

How is my financial situation?  Sit down and assess whether you can live comfortably on the lower salary.  And while you’re at it, determine how strong your financial safety net is.  If you choose to leave the job, you’ll need at least three months of expenses saved in addition to what the company is giving you because it might take you longer than you think to find work.

How is the market in my chosen field?  Whether you’re looking to stay in your current area or move into something new, you need to know how the market is.  Check out job websites, classified ads, LinkedIn and your professional network to see how things look.  If the market in your chosen profession doesn’t look good, it’s probably best to stay where you are.

Which choice fits into my long-term plan better?  Don’t just think about the next step, think beyond the next step.  Where do you want to be in five, 10 or 20 years?  Would staying at your current job or finding a new job put you on the right track?  If you need to make a change to get to where you want to be, then (provided your financial situation can handle the strain) this might be a good opportunity to take the leap.

Could I keep working here at the lower pay level while I start looking for work elsewhere?  If you take this demotion, do you have to sign a contract keeping you with your company for a certain period of time?  Or could you take the demotion and start looking for work elsewhere?  Because if you know this isn’t the job you want to be doing, then you should be actively working on the next step whether you take the severance or not.

What will I do if I don’t find work quickly?  If three months in you haven’t found work, what will you do?  Can you pick up temp work?  A part-time job?  Earn money telling fortunes at the county fair?  It’s always a good idea to have a back up plan when making a risky career move.

Leaving a job, even one that is going to pay you less, is a risk.  Don’t take this decision lightly.  You need to make sure your financial house is in order, that you have a clear view of where you want to go from here and have a fall back plan in case things don’t work out.

Personally, I’d take the dismissal and pick up some temp work while I looked for something more permanent that gets me on the path to my dream job.  But you’re the only person who can make this decision.

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    26 comments

  1. Anon says:

    Is “dismissal” a term that encompasses all kinds of departure? over this side of the pond, it can havenegative connotations – “being made redundant” is the terms for what you describe. So you may want to look at the terminology applied if you decide to take the departure.

    Make sure to check out the tax implications of the financial package. Does the US system tax redundancy payments? Are there any other knock-on consequences? (How is your health care provision affected? Car insurance? etc etc)

    Ask yourself not only about whether you would be allowed to look for something else, but also whether you would be able to stay (and be seen to be) motivated and committed at the lower level or would your performance be affected? Disillusion/disengagement is a very insisdious thing.

    When you have done all the very essential cold, hard, logical analysis, and know what conclusion that suggests, do check back with your gut feeling abobut what you really want to do. If it’s different, you may need to go round again and look at what’s the worst that could happen if you followed the gut instinct.

    July 24, 2013/Reply
  2. Jenn L. says:

    Furthermore, another factor (though not glamorous) – if you take the dismissal to look for another job, after your 8 weeks pay would you be eligible for unemployment if something does not fall through? Or would your severance agreement prevent that?

    Relying on unemployment is never a good idea, but it is worth being aware of in case of Murphy’s Law, etc.

    July 24, 2013/Reply
  3. S says:

    These are incredible tips and your situation is a difficult one. I lost my job in January after 6 years on Capitol Hill. I have a Masters degree. I have taken a TON of interviews, sent out over 100 applications since January, taken more networking coffees than I can count, gone through 4 temp firms, applied for about 8 part-time jobs and here it is almost August and I have yet to find anything. I’m serious when I say it’s a terrible job climate. My recommendation? And please know that this is only based on my personal experience in a city that is supposed to have a lot of promise and is also the 3rd most expensive place to live….stay in your job. Use the pay cut as a reason to start networking, applying for other jobs, trying to find your next move WHILE you still have income. Being jobless is the worst thing I have ever experience and my journey is not over yet. Best wishes.

    July 24, 2013/Reply
    • Wj says:

      S: hang in there. I’ve been in exactly that spot and I feel for you. It sounds like you’re doing everything right, so just keep at it.

      July 24, 2013/Reply
    • J says:

      I could not agree more S.

      My first year out of college I found myself working 80 hours a week interning and working at a bar. This year of underemployment was one of the lowest points of my life. I had to fight tooth and nail to get a job that is way beneath what I believe my value to be.

      Discrimination towards the unemployed and the underemployed in the DC job market is real. The old adage is true – it’s much easier to find a job when you already have a job.

      I feel very strongly that you should stay in your current job and begin your job hunt ASAP.

      July 24, 2013/Reply
    • Capitol Hill SE says:

      How are you supposed to do all that if you’re working a full time job though? I went through the same thing (back in 2006, with an engineering degree, when the market was supposedly better) and my employer eventually caught on and fired me. There are only so many afternoons you can take off for “doctor’s appointments” before they’ll get suspicious. In this situation the employer is probably looking for signs already since they’re given her a good reason to leave.

      July 25, 2013/Reply
      • Belle says:

        I paid $22 dollars more for the dress at the Net-a-Porter sale than I would have on the Outnet. But you need to remember that NaP only has two (three, maybe) sales per year. And that the stock and options at the Outnet are generally better.

        July 25, 2013/Reply
  4. Chelsea says:

    I would take the demotion but at the same time, start looking for a new job. Job searching these days takes an average of 3 months and I would never want to risk ending up with nothing.

    July 24, 2013/Reply
    • lcris says:

      I had the very same thought. I would not leave without something else lined up. Besides the salary I always worry about health insurance.

      July 24, 2013/Reply
  5. SLG says:

    As Belle noted, this is a very personal decision that only you can make. But as a recent veteran of a longer-than-I-planned job hunt, I’d like to note that it’s common these days for a job hunt to take a year or more. Stats that tell you a job hunt takes 3 months are outdated. I’d advise taking the dismissal only if you can swing a year+ of unemployment, given your finances, medical insurance situation, etc.

    As a corollary, temp work may be much more difficult to find than it used to be. Seven years ago I had all the temp work I could want while I looked for a full-time position. In 2012 I pounded the temp agency pavement for months and got nothing (until my current full-time position came along, which I love).

    You might check out http://www.askamanager.org too — that blogger has some great advice on situations like this. Best wishes for your search — good jobs may take more time to find these days but they are out there!

    July 24, 2013/Reply
  6. Giggling Gourmand says:

    Do you work in an industry that uses headhunters? I considered lateraling from one firm to another about 2 years ago in what was a very tight legal market. Using a recruiter landed me at least half a dozen interviews and 3 job offers in a matter of weeks. I didn’t end up making that move, but it was a very helpful service.

    July 24, 2013/Reply
  7. Sofie says:

    The most important expenses for you right now are likely housing and student loans. As long as those are taken care of with a smaller salary, everything else will probably be okay. (Last year, I took a $15,000 pay cut when I switched jobs, and it was manageable because I had adequate savings, had reasonable housing costs, and had no student loans. It was a great move for me because I left a frustrating job for a job I love.)

    July 24, 2013/Reply
  8. Amy says:

    Here’s the old lady weighing in: keep the job but start looking for another ASAP. One of my former bosses (who’s now a US Senator) frequently told me that it is easier to find a job when you have a job. It has to do with people giving you value because someone else has you. Think of it this way, guys always seem to find other guy’s girlfriends, they want what they can’t have. As an employer, I would give you points for loyalty in sticking with the company during an economic downturn. Plus, it’s better to have some income than none. Best of luck!

    July 24, 2013/Reply
  9. lws says:

    Another vote for take the demotion and start looking. 8 weeks just isn’t enough time to find a job especially given that little hiring occurs at year end.

    July 24, 2013/Reply
  10. Anna says:

    I agree that it might be most prudent to look for a job while you have one, assuming that’s an option. I would also have a frank talk with my supervisor about my career goals, my place in the company, and how I can move forward professionally while being most helpful during the company’s transition. It helps to have people above you looking out and willing to be helpful. Most supervisors understand that this may not be your dream job and it could be ultimately beneficial to them to have their people move on to bigger things. Make it clear you don’t want to leave them high and dry and will put 100% into your current position, but you also have to think about your next step.

    July 24, 2013/Reply
  11. Grapeful says:

    For me this is a no brainer. My advice is to take the paycut and then continue to look for a new position while you still have one. The worst that can happen is that you don’t get a new job but you have a reliable income source from a job you don’t hate. The worst that can happen if you allow yourself to be laid off is that you remain unemployed or end up with a job you dislike even more. Normally I advise for the high risk, high reward strategy. But being laid off now doesn’t increase your chances of finding that better next job versus keeping your current job and continuing to search. Keeping your current job is the closest to a win-win situation right now.

    July 24, 2013/Reply
  12. Ann E. says:

    One more thing here, while I’m inclined to say take the demotion unless you have untold amounts of cash in savings. Would you have the possibility to keep a job title that is more “on par” with your current one? A title that would still look good on your resume? Could you negotiate for additional paid time off? I’m a proponent of at least asking for any other things that you could to do make you feel better about they pay cut.

    July 24, 2013/Reply
  13. anon says:

    Eek, rough situation. I agree with a ton of this advice. Having just got out of the unemployment bucket a bit ago, the fact that I was currently freelancing was a HUGE plus because I was still gaining experience. I also agree that temp work is tougher these days to find because well, everyone is looking. If your job is one that you can find freelance work for that can tide you over in addition the severance package that you’d get … I would probably advocate leaving your position IF you feel like your attitude and general happiness there will begin to reflect poorly on your work. If you have one foot in and one foot out, it (most likely) will show, and you want to leave with a strong, positive impression so that you can use your current employer as a reference and possibly as a connection if that’s the kind of relationship you have with him/her or other employees.

    That being said, the financial aspect of this is very real. DC is an expensive city and though I moved shortly after my layoff, the freelancing I did helped me tremendously when I Was nearing the end of my job search and the severance was running a bit lower than I wanted. In sum: Research your market, see how viable it is to get your foot in the door elsewhere, evaluate how you would feel with a demotion at your current gig, and network your @$$ off. Good luck!!

    July 24, 2013/Reply
  14. Jackmo says:

    I generally agree with everyone who recommends staying at the current job. It’s much easier to find a job when you have a job, and since you don’t know how long you might be unemployed, it’s a big financial risk to take.

    HOWEVER, I would that if you really don’t like your job AND you’re not getting paid your worth, then you need to get out soon. I’ve been in a job I hate for the past few months largely because I need the money and health insurance, but it’s taken such a toll on my mental and emotional health that I feel I can say that money isn’t worth sacrificing your mental/emotional health, if you have other options.

    So I guess what I’m saying is this: if money is an issue for you, stay in your job, but start looking for another job ASAP, so that your job situation doesn’t start to affect your health and perspective.

    July 24, 2013/Reply
    • MM says:

      Agree. Having an exit strategy and embracing that this, too, shall pass are the keys to keeping your sanity in a situation like this.

      July 24, 2013/Reply
  15. Jess says:

    I just want to chime in and mention it really does depend of the market for your profession and your area. I live in the DC Metro area and have several friends in the IT industry who have recently had no trouble finding a new higher paying job within a couple weeks, while other local friends in other professions have had very long job hunts. Know your market is really great advice.

    July 24, 2013/Reply
  16. Ginger R. says:

    I agree with Anon #1 who doesn’t like the sound of “dismissal.” Have other people in your area been getting this same message? The writer mentions it’s not her dream job, and at 26 she can’t have been there very long.
    I would ask that it be termed a lay-off so you can collect unemployment later, take the severance, negotiate for extended benefits and depart. If you take a pay cut and look for a job you are going to have to explain why you want a 14% raise over your “current” salary. Once you start working for less why should anyone pay you more?

    If you aren’t in love with the job/organization now you won’t like them a bit better at less pay, particularly if other people you’ve worked with aren’t suffering the same fate.
    Looking for a job isn’t any fun, but staying in a job where you aren’t happy is torture.

    July 24, 2013/Reply
  17. Ginger W says:

    Stay until you find something else. I’ve had two bouts of unemployment, and there is nothing scarier than not knowing if/when you’ll get another job. The job hunt always takes three to four times as long as you think it’s going to, and it’s easier to get a job when you have a job. This last go-round I sent out over 300 resumes, had 20+ interviews, and it took a year to find something else. And this is with a master’s degree and 10+ years of experience.

    July 24, 2013/Reply
  18. lizzie says:

    I definitely agree with the previous posts about staying on (but beginning your job search in earnest immediately!) rather than taking the dismissal. Having sat in on the hiring process for several new employees in my organization over the past couple years, bias against those currently unemployed is a very real thing and comes out in all kinds of subtle ways – it’s incredibly unfair but I think in a situation like yours it is better to be aware of it beforehand.

    I would also caution you to take a hard look at how emotionally ready you are (in addition to all the other ways listed) for an extended stretch of job hunting/unemployment. After finishing grad school and moving to a new city, it took me nearly a year to land my “dream job”. The months in between were one of the most stressful and emotionally draining times of my life. I was lucky to have family and friends who helped me through it but I was in no way prepared for how daunting it was and how much it made me question myself and my decisions. Some of this was healthy of course but if you’ve already got other things you are dealing with/going through right now, I would be really hesitant to take the plunge and leave your current employment without something else lined up.

    July 24, 2013/Reply
  19. Anon says:

    Anon #1 again. I forgot to ask a key question, namely, what is your relationship with your supervisor? You say she “pulled you aside” – did you feel that wss a supportive gesture (giving you advance notice), a neutral one (if everyone else was being pulled aside) or did you feel it was hostile? The answer should also help inform your decision: if it was hostile, staying may not be such a good option. On the other hand, if it was neutral or helpful, you may have the opportunity to go back to her to discuss options and negotiate terms as Ann E indicated. As well as making a difference on your resume, it would also help you psychologically because you would have taken charge of your desitny to some degree rather than havig things done to you. I have found the hard way that this helps a lot in difficult circumstances.

    July 25, 2013/Reply
  20. SJ says:

    Take the pay cut, look for a new job. Even if you saw a listing tomorrow for what is your dream job, hypothetically it could take you up to two months to get it — between applying, phone interviews, first round of interviews, second round, etc. A job isn’t going to be posted on Friday and you start on Monday. Things take time. I just took a new job a few months ago and it was a process. At least you’ll be able to make rent while you look.

    July 25, 2013/Reply