5 Ways To Turn A Layoff Into A Career Change Opportunity

A layoff can be the turning point that leads to a more fulfilling career change. The dreaded email arrives unexpectedly. Or maybe you saw it coming for weeks. With Amazon reportedly cutting 30,000 corporate jobs, Target announcing layoffs and similar headlines across industries, this reality is hitting professionals everywhere. Being laid off feels unsettling at best. But here's what many successful professionals have discovered: a layoff can be the catalyst for a career change that propels you toward work you actually love, rather than one you simply tolerate. The key is resilience—the ability to transform adversity into opportunity. Here are five strategic ways to transform a layoff into a launchpad for your next chapter. 1. Conduct a Brutally Honest Career Audit Before you frantically update your resume and start applying to similar positions, take a breath. This moment of disruption is your opportunity to examine whether you've been on the right path. Many professionals spend years climbing a ladder only to realize it's been leading them away from what matters most. Start by asking yourself difficult questions: What parts of your previous role energized you? Which tasks made time fly by, and which made you watch the clock? What drained you? What meetings did you dread? Were you in the right industry? Did your company's values align with yours? Do you thrive with autonomy or prefer structured guidance? Do you prefer working with others or focusing on independent projects? Sometimes we convince ourselves we're satisfied because the salary is competitive or the title is impressive, but a layoff strips away those justifications. Understanding your true preferences is crucial for identifying career paths that will actually suit you. Action Step: Create a spreadsheet listing every significant responsibility as "Energizing," "Neutral," or "Draining," then research careers that maximize the energizing elements. MORE FOR YOU 2. Invest Your Severance in Skills—Not Just Survival Once you've identified your target direction, you'll likely discover a gap between your current capabilities and the requirements of your desired role. Closing that gap requires strategic investment. If you received a severance package, you have a unique opportunity. The conservative approach is to save every dollar for basic expenses while searching for a similar job. Instead, strategically invest a portion of that severance in acquiring the skills, credentials or knowledge that will fund a career change. You don't need to be reckless. Even if you have a modest cushion, consider allocating 10% to 20% of your severance toward professional development that aligns with your newly identified career goals. Strategic investments might include: Courses, certifications or programs that directly address skill gaps between your current capabilities and your target role Professional associations in your target industry Industry conferences (many offer virtual options at reduced rates) Subscriptions to industry publications and thought leaders Action Step: Create a budget covering six to 12 months of expenses, then allocate $1,000 to $5,000 to career transition resources. Enroll in at least one high-quality course within two weeks. 3. Rebrand Yourself Before You Re-Enter the Market One of the biggest mistakes professionals make during a career change is relying on their old personal brand. Your resume and LinkedIn profile still emphasize expertise in the industry you're leaving behind. Successful career changers understand that you're reframing your existing experience through the lens of your new career. For example, the project management skills you developed in healthcare operations are absolutely relevant to program management in tech. The client relationship expertise you built in financial services translates directly to customer success roles in SaaS companies. Here's how to rebrand yourself effectively: Update your LinkedIn profile: Rewrite your headline to reflect your target role, not your previous one. Instead of "Former Senior Manager at [Company]," try "Operations Leader Transitioning to Product Management." Your summary should tell the story of your transition: why you're making this change, what transferable skills you bring and what value you'll create in your new field. Revise your resume: Emphasize transferable skills and relevant accomplishments. Use the language of your target industry. Study job postings and incorporate the terminology and keywords that appear repeatedly. Create content: Demonstrate your knowledge and passion for your new field by writing LinkedIn articles, starting a blog, or contributing to relevant online communities. Action Step: Overhaul your LinkedIn profile and resume to reflect your career transition. Create and publish at least one piece of content that demonstrates your enthusiasm for your new field. 4. Embrace a Portfolio Career or Side Hustle The traditional career change model involves leaving one full-time job and finding another full-time job in a different field. But this approach is risky, often slow and leaves no room for experimentation. You're either in your old career or your new one, with no middle ground. A more flexible approach is building a portfolio career or launching a side hustle that allows you to test and develop your new direction while maintaining some income security. This might mean taking on freelance projects in your target field, starting a consulting practice or creating a small business that aligns with your interests and skills. This approach offers multiple advantages: It generates income during your transition, reducing financial pressure It allows you to build real-world experience and credibility in your new field It provides valuable market feedback so you'll quickly learn whether your new direction is viable and fulfilling It creates options, and you might discover that you prefer the flexibility of portfolio work to traditional employment Action Step: Identify three ways you could generate income in your target field within 30 days through freelance platforms, consulting opportunities or contract roles. Secure at least one paid engagement within the next month. 5. Reframe Your Narrative From Victim to Architect The most important shift you can make is psychological. How you tell the story of your layoff, to yourself and others, will significantly impact your career change success. If you frame yourself as a victim, you'll approach your job search from a position of weakness. If you frame yourself as the architect of an intentional career change, you'll project confidence and purpose. Practice articulating your story in a way that's honest but empowering. When networking contacts or interviewers ask about your situation, you might say: "I was affected by layoffs at [Company], which gave me the opportunity to reassess my career direction. I realized I wanted to focus more on [new field] because [compelling reason]. I've been investing in developing [relevant skills] and I'm excited about bringing my background in [previous field] to this new challenge." This narrative: Acknowledges the layoff without dwelling on it Emphasizes your agency and intentionality Frames your diverse background as an asset rather than a liability Action Step: Write out your career transition story in 150-200 words and practice delivering it until it feels natural. Identify 10 people in your network who might have connections to your target field and reach out with your new narrative. Seize the Moment Being laid off is undeniably difficult. It disrupts your routine, challenges your identity and creates financial uncertainty. But it also creates a forced pause that allows you to reconsider your professional trajectory without a steady paycheck keeping you on autopilot. The professionals who thrive after a layoff resist the urge to immediately recreate what they had before and instead use this disruption as a catalyst for intentional career change. Your layoff doesn't define you—but how you respond to it will. The question isn't whether you'll recover, but whether you'll use this moment to create something better than what you had before. If you liked this, you’ll also want to read: The AI Boom Is Here But Small Businesses Bet On Human Skills Career Change After 50: Why Midlife Is The Best Time To Pivot 5 Side Hustle Secrets To Avoid Burnout While Working Full-Time More from me: Explore my latest Forbes articles Subscribe: Join my free newsletter for weekly strategies to create freedom, flexibility and fulfillment at work. Editorial StandardsReprints & Permissions