Laid Off vs. Fired: The Differences Explained

By Mike Simpson

Laid off vs. fired; are they really that different? In the end, they both mean ending up unemployed suddenly, so doesn’t that make them more or less the same? Well, yes and no.

In the eyes of many candidates, the difference between being laid off or fired may seem minimal. Either way, your employment ends, usually without much warning.

But hiring managers see the situations incredibly differently. That’s why it’s so critical to understand how being laid off and being fired stand apart, so you can approach each circumstance in the best way possible.

So, if you have questions about being laid off vs. being fired, no worries. We’ve got you covered.

Laid Off vs. Fired

Alright, before we talk about how a layoff and a firing differ, it’s important to understand what “fired” and “laid off” actually mean.

Being fired from a job means losing your position for reasons that are typically under your control. For example, maybe your job performance just wasn’t up to snuff, or you had a few more unexplained absences than the company could allow. Perhaps tardiness was an issue, or you didn’t follow company policy to the letter. Maybe there was a serious personality conflict between you and the manager or you and your teammates. All of those issues could result in a firing.

In most cases, before a firing, the writing’s on the wall. Many companies issue warnings about performance or behavior problems, so the employee is usually aware that their job could be on the line.

When you’re fired, you may or may not have access to certain benefits, like unemployment. Whether you do depends on why you were let go, but the majority of fired employees don’t qualify.

So, what does laid off mean? Well, typically, a layoff is an end of your employment for a reason that’s not in your control. The most common one is a company reducing its staffing numbers due to a change in profitability or business needs.

Organizational restructuring is another, as that move that can make you redundant or unnecessary in the new structure. Acquisition, mergers, and slow-season downsizing are other situations that result in layoffs.

With a layoff, you may or may not get a heads up. Sometimes companies have to make quick decisions, not unlike what many businesses dealt with during COVID-19. With that, you may not have a clue you’re at risk until they let you go.

However, some layoffs are predictable. For example, companies that ramp up their workforce for peak season usually have to reduce staffing when that season ends. It’s a normal cycle, so employees commonly know it is coming when the time arrives.

With layoffs, you usually get access to benefits like unemployment. You didn’t do anything wrong, so you’ll qualify for most programs designed to get displaced workers back on their feet.

Now, those aren’t the only phrases that cover the unexpected end of a job. For example, many people use the word “terminated.”

So, what does terminated mean? Well, this one is tricky. Technically, any situation that causes your job to come to a close counts. “Terminate” just means “to end,” according to the Cambridge Dictionary. A bit ambiguous, right?

Really, “terminated” could refer to a firing or layoff. However, most of the time, when people say they were terminated, they are avoiding saying they were fired.

The Affect of Each on Your Career/Job Search

Both layoffs and firings impact your career and job search differently. Generally, hiring managers are pretty understanding about layoffs. Those can happen even if your performance was outstanding, so losing your job because of downsizing or company shutdowns isn’t typically an issue.

But a layoff can result in a gap in your work history. Depending how you manage it, that may or may not cause a problem. If you spend your time learning new skills, volunteering, working temp jobs, or otherwise minimizing the gap, you’re in good shape. If you don’t and the gap gets long, it could work against you a bit.

Luckily, we’ve got a formula to help you move forward after a layoff. We’ll dig into that more here in a minute.

Okay, but what about being fired? Well, when you’re fired from a job, the situation typically wasn’t out of your control. That makes things a little more difficult.

Now, many professionals think that getting fired spells doom for their career. In reality, that isn’t true. Overall, 91 percent of people bounce back after being canned, landing a job that was as good as or better than the one they lost.

The trick is, you have to manage the situation properly. Along with trying to keep your work history gap small, you’ll need to go the extra mile.

First and foremost, you have to be honest. Trying to hide a firing isn’t going to work, as the truth is practically destined to emerge at some point.

Beyond that, you’ll want to show the hiring manager that you’ve learned from the experience, that you don’t hold a grudge, and that you’re taking responsibility for your part of the equation. If you can do that, you’re probably not in as bad a shape as you might think.

Aren’t sure how you can pull that off? Don’t worry. We’ll get to that in a second.

What Happens After You Get Laid Off?

Alright, so you’ve been laid off. Now what? Well, we’ve taken a deep dive into what to do when you get laid off before. But here’s a quick overview.

First, take a deep breath. It’s a rough situation, but you can (and will) get through it, so keep your chin up.

Also, file an unemployment claim immediately. There’s a good shot you’ll qualify for benefits, so don’t delay. The longer you wait, the longer it takes to access that source of income and support, so make the call right away.

Next, spend a little time envisioning a new future for your career. Now that you’re jumping back into the job market, what kind of role do you want? How can you best use your skills? The idea is to start crafting a new plan, one that leaves you excited for the future.

After that, you’ll want to do two things. First, brush up your resume, cover letter, and LinkedIn profile. You may even want to create a personal branding website, a move that can help you stand out from the pack.

It’s also smart to notify your network about your upcoming job search. That way, if they know about any opportunities, they can refer you.

Second, plan to close that gap quickly. As we mentioned above, you want to keep your skills sharp, and signing up for a class can minimize (or eliminate) the impact of a gap. So can volunteering, freelancing, or accepting a temporary job, even if the positions are part-time.

Once those steps are done, launch that job search. Download some job search apps, get on job boards, connect with recruiters, and remain in touch with your network.

As you find positions, it’s time to apply. We’ve covered how to apply for a job in-depth before, so you can look there for specific tips.

After you start applying, it’s time to prep for interviews. Review general job interview questions as well as ones for your field. You may also want to research how to answer behavioral interview questions specifically, as those can be quite tricky.

Then, just keep at it. It can take a little time to land something new. By keeping focused on your goals, you can stay motivated. That way, when the right opportunity comes along, you’ll be ready to seize it.

What Happens If You Get Fired?

If you were fired from a job, your next steps should be similar to what you’d do after a layoff. However, your first step should be to reflect on what happened. Why? So that you can learn from that experience.

Spend a little time examining what occurred and what you can do differently in the future. Additionally, take an honest assessment of your skills and traits, allowing you to focus on opportunities that really align with your capabilities.

Once you do, get ready to close the gap and launch a job search. Update your resume, cover letter, and LinkedIn profile. Look for educational opportunities, volunteer positions, or temporary roles that minimize or eliminate the gap. Contact your network to learn about options.

After that, hop onto job boards, reach out to a recruiter, and otherwise get searching. Practice your interview skills as you do. That way, you’ll be ready when the chance to interview arrives.

Explaining a Layoff in a Job Interview

Okay, we mentioned that you need to plan for interviews a little bit ago. So, what do you do when the hiring manager asks why you left your last position?

Well, if you were laid off from work, it’s pretty simple; tell them you were laid off. Hiring managers know that layoffs happen, so there’s no reason not to be upfront about what went down.

However, do keep it brief. For example, if you were let go because of COVID-19, you can say something like,

“After COVID-19 resulted in stay-at-home orders, business dropped dramatically. As a result, my employer has a large-scale layoff, and my position was one of many that was cut.”

After you give a simple overview, pivot. Refocus your answer to discuss how excited you are about the opportunity, how you’re looking forward to rejoining the workforce, and why you’re thrilled to have a chance to work for this company. That lets you end on a high note while still answering the question directly.

Explaining a Firing in a Job Interview

While it may be tempting to try and hid that you were fired, don’t. Transparency is always the best choice. There’s a good chance the hiring manager will find out anyway, so it’s better that they hear the facts from you.

However, just like describing a layoff, you want to be brief. Take ownership of the situation, as that makes you seem accountable. But then quickly shift gears, concentrating on what you learned and how the experience will help you exceed expectations going forward.

For example, if you were fired for performance issues, you could say something like,

“In my last role, my skill set and the position ultimately weren’t a strong match, causing me to struggle and, ultimately, lose the job. But this experience taught me a lot about my capabilities, allowing me to identify paths that aligned with my strengths. I feel that this opportunity is an exceptional fit, and believe I would bring a lot of value to the company in this role.”

When you pivot, get specific. Talk about the exact skills you have that fit the target position. Give a solid example of how you’ve excelled in that area in the past. By discussing individual qualifications and how you shine in that arena, you get to take the conversation in a positive direction, and that can minimize the impact of the firing.

MIKE'S TIP: If the firing was significant, you might want to use a different approach. Performance issues may be easy to explain, but if you were fired because of a severe incident of misconduct, that isn’t always the case. If your time with that company was short or the firing isn’t recent and you’ve worked since then, you may be better off leaving that position off of your resume if the job application doesn’t require you to list every role. While you won’t be able to use it to showcase your capabilities, you may be able to bypass talking about what happened if you go this route. That may work in your favor.

Putting It All Together

Ultimately, you can bounce back after a layoff or firing. Use the tips above to get yourself prepared. That way, when opportunity comes knocking, you’ll be ready to answer.

Good luck!

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About The Author

Mike Simpson

Co-Founder and CEO of TheInterviewGuys.com. Mike is a job interview and career expert and the head writer at TheInterviewGuys.com. His advice and insights have been shared and featured by publications such as Forbes, Entrepreneur, CNBC and more as well as educational institutions such as the University of Michigan, Penn State, Northeastern and others. Learn more about The Interview Guys on our About Us page.