Contributing Writer at Tally
May 21, 2020
Finding yourself suddenly unemployed can be a stressful time. Not only must you find a new job, but you must also maintain your financial health. With the right actions, though, you can make the most of this time and come out of it with stronger career prospects than before.
Updating your resume, learning new skills and preparing for interviews will help you improve your chances of landing your next job. Below, we'll cover what to do when you're unemployed, starting with managing your finances.
While job hunting, which takes 43 days on average, you must keep at least some income rolling into your bank account. Though you may have lost your full-time job, there are ways to make ends meet — or at least bring the ends closer to meeting.
When you lose your job, it can be a blow to your mental health. The last thing you want to do is let financial issues compound this. While unemployment benefits generally cover only a portion of your income, they at least set a floor to build upon.
Unemployment benefits vary greatly by state, but they range from a low of $235 per week in Mississippi to a high of $1,220 per week in Massachusetts, as of May 2020. In some extreme cases, the government releases additional benefits, like the extra $400 per week for four months during the COVID-19 outbreak in 2020.
Make sure that you apply for these benefits immediately and that you’re getting all the benefits you deserve.
Lay out all your monthly expenses and see how they stack up relative to your income from unemployment — then reduce as needed.
Add up all your monthly expenses and subtract them from your unemployment income. If you live a relatively frugal life, your budget may still balance out. In most cases, though, you’ll find your income doesn’t meet your expenses. In this case, you must prioritize and trim.
Start with your essentials — rent or mortgage, groceries and utilities. Set these aside, as you need them to survive and they’re rarely negotiable.
Then, review your nonessential expenses and prioritize them by importance. While a car may not be essential because your city has a great public transit system, it may still top the nonessential list while job hunting. At the bottom of your list will be things you can live without for now, like a Netflix subscription, daily coffee shop visits, monthly clothing expenses, gym memberships and so on.
Start balancing your budget by adding up those essential monthly expenses and deleting them from your unemployment compensation to get your discretionary income. If there is no discretionary income left or your income is less than your essential expenses, you’ll need to earn additional monthly income, which we’ll cover later.
When eliminating nonessential expenses, start by trimming some cost from the more important expenses. For example, lowering internet speeds, selling your car with a high payment and buying a less expensive one or opting for a lower-cost cell phone plan.
If trimming doesn’t lower your expenses enough to meet your unemployment income, eliminate some nonessential expenses. Start with the least important items and move upward, cutting the expenses you can live without until your income meets or exceeds your monthly expenses.
Even after eliminating nonessential expenses, you may still come up short on income. This is where supplementing your income becomes key.
If you’ve reduced your costs, and your unemployment income just isn’t cutting it, you will need to supplement it with extra cash on the side.
Even if your budget is balanced or has an income surplus, putting your spare time toward earning extra income can’t hurt. There are plenty of ways to earn extra income while unemployed. Some of the most fruitful ones are as follows.
When you're unemployed, you may find you suddenly have a lot of extra time. You can use this free time to earn extra money on demand by picking up a side gig.
Unlike taking a part-time job where you must adhere to a fixed schedule, these gigs allow you to earn extra money when you have time and when you need it. If you don't have the extra time due to job hunting tasks or an interview, you can simply not accept any work.
There's a wide range of these on-demand side gigs to pick from, but some of the most common include:
Being an Uber or Lyft driver
Delivering groceries with Instacart or Shipt
Providing food delivery with Uber Eats, Postmates or DoorDash
Performing various tasks with TaskRabbit
If one of these on-demand gigs doesn't fit your needs, you can also venture into the freelance world. Using your background and skills as your guide, find freelance gigs, like writing, editing, programming or web development, to boost your income while you're searching for a full-time job. Many times, you can find these freelance positions on the same job sites you’re already searching.
If you're collecting unemployment benefits, make sure to check the laws in your state regarding combining gig income with your benefits. You may have to claim this income, thereby reducing your unemployment benefits.
In some cases, a side gig may not offer the income you need or simply won't be available in your area. This is where temporary work can help fill in the gaps.
In many cities and towns there are temporary employment agencies that help larger employers find temporary workers. This is generally part- or full-time work that covers employees who are on an extended leave or makes up for seasonal demand increases.
A temporary job not only gives you the extra income you need, it'll also give you experience, eliminate a gap in your resume and can sometimes lead to a lucrative full-time job with the company.
Another good use of your extra time when unemployed is to declutter your home and sell anything of value you never use. Not only are you helping your mental health by getting your home in order, you can also turn those items you never use into cash to get you through this rough patch.
There's a wide range of places to sell the items you have sitting around the house. Some of the more reliable marketplaces include:
If you're not squeamish about needles, you can make extra income donating plasma, which is the clear part of the blood that contains various enzymes and proteins.
Donating plasma is more involved and more uncomfortable than donating blood, but donation centers will compensate for that. You generally don’t get paid for blood donation, but you can get $20-$50 per plasma donation, depending on the area and what facility you go to. Generally, the donation process takes 1.25-1.5 hours, so you can earn about $13-$30 per hour.
The biggest variable is how many times you can donate. The American Red Cross limits plasma donations to once every 28 days. The FDA allows private plasma centers to draw your plasma twice a week with at least a 48-hour gap between each donation. If you're making $50 per donation, that's over $400 per month, plus you’re helping save lives.
Having a credit card with a wide-open, available balance may be enticing during this tough financial stretch. Instead of struggling, why not toss all your expenses on a credit card and catch up when you get a job? There are a few good reasons not to do that.
First, you never know how long this unemployment stretch will last. If it’s only a few weeks, you may be OK. But if it goes longer, that mounting credit card debt will start eating into the reduced income you have coming in. Also, once you find a job, the last thing you want is to add the stress of paying off debt to a time when you're trying to get up to speed at a new company.
Can your credit cards help if things get extremely tight? Yes, but they should be a last resort, and you should use them wisely.
An example of when a credit card can help is if your electric bill is due today, but your unemployment check won’t arrive for another week. Avoid the late fee on the electric bill by using the credit card to pay it, but once you get your unemployment check, pay off the credit card to avoid interest charges.
Starting a job search is one of the first actions to take when you're unemployed. The digital world we live in today makes this easier and harder than ever.
It's easier because you no longer have to search for jobs in the newspaper or go to dozens of businesses to fill out applications. You can now do this all online — you can even set up job alerts that help you find a new job that fits your skills.
It's harder because the digitization of the job search has made it easier for everyone, so there is a lot of competition.
Here are a few steps to a successful job hunting process.
Every job seeker needs an up-to-date resume. If you were at your former job for a long time, there's a good chance your resume is outdated. It likely lacks all the new skills you gained over the years at your last job. Dig into that resume and get it up to date with all the skills relevant to the job you're seeking.
This is also a great time to create a draft cover letter that you can update to fit each job you apply for. Your cover letter should highlight how your skills align with the position you're applying for. This isn't a time to brag about achievements. Instead, this is the time to show how you fit the role perfectly by putting your past achievements, skills and experience into the context of the role you're applying for.
Your cover letter should be short and to the point. A paragraph outlining your interest, a handful of bullet points showing how your skills and experience apply to the role, and a closing paragraph thanking the hiring manager for her time will work.
While you're at it, update any social media you plan to include in your job search. For most job hunters, this will likely be your Linkedin profile, but if you happen to also have a work-centric Facebook or Twitter account, you should update that too.
Like your resume, make sure your social media profiles highlight any new skills you've gained and your latest experience.
Gone are the days of searching the "Help Wanted" section of the newspaper to find a new job. Today, there are countless online job sites that aggregate all the open roles nationwide. Sites like Glassdoor, Indeed and Linkedin are great places to look, but you'll also want to seek out job sites specific to your niche.
For example, if you're a computer programmer, you should sign up for an IT-specific job site, like Dice.
Focus your job hunting on these sites and scour them daily. If they have an automatic notification system that alerts you when new matching job opportunities pop up, activate that alert so you're always in the loop.
When you find a job opportunity that looks interesting and that you feel you can do, apply for it, even if some of the skills or experience required don't align with what you have. Many times, these job descriptions are written for the ideal candidate, and companies are willing to be flexible for the right applicant, according to human resources advisors at Gerald Walsh Associates.
The more job applications you submit, the more likely it is you'll find a new job.
Once you've impressed the screener and landed the job interview, now's the time to show what you've really got.
The first part of acing an interview is knowing the company well. Go to the company's website and research its background, products, demographics and other key parts of the business. Use that information to create some basic questions about the role and the company — hiring managers love these company-specific questions.
Once you've got the company down pat, it's time to look the part. Whether it's a virtual or in-person interview, dress for the job you want, not the one you're interviewing for. A nice suit will do for most job interviews. It may seem like overkill to wear a suit to some interviews, but that'll only make you stand out more. Your job is to be memorable to the hiring manager.
Another tip is to have a breath mint, breath spray or gum available to freshen up just before heading into the interview. You want to stand out, but not in an unfresh way. Make sure you toss out or swallow the gum or mint before meeting the interviewer.
A post-interview follow-up is important. Not only is it polite, it also jogs the hiring manager's memory of your amazing interview amid the mass of other applicants she's had.
Be respectful of the hiring manager's time and schedule by sticking to a short, humble email. Thank the manager for her time, quickly reaffirm your interest in the role and what you can offer, and let her know she can contact you if there are any additional details she needs. This is also a great time to pass a reference to the manager or to attach a letter of recommendation from a former employer.
Even with a side hustle or a part-time temporary job, you may still have plenty of extra time on your hands. Sure, relaxing and catching up on that Netflix show you've fallen behind on can get your mind off job hunting for a bit, but you've got to keep your eye on the goal at hand.
You can help yourself by using this free time to better your career outlook with these tasks.
Sometimes the hardest part of finding a job is matching your skill set to what employers are seeking. This is especially true if you were at your last job for a while and never had the opportunity to learn the latest technology.
Maybe you lack typing skills because your company used handwritten invoices, or you have a limited understanding of Microsoft Excel because your former employer used a proprietary spreadsheet system. Or maybe you want to learn something new altogether and transition into a new industry.
Whatever the case, this is the time to build these skills and make yourself more marketable.
In some cases, your state's unemployment office can direct you to free workshops to help you build these important skills. There are also various inexpensive online courses and short courses at local colleges covering these topics.
While a networking event may not net you an on-the-spot job offer, it can be a cog in the wheel toward getting one. While chatting with that like-minded, recently laid-off manager at a networking event may not be fruitful right now, making that connection can help down the road.
Say that manager gets hired to lead a team the week after the event and needs someone with your skills on his team. You've already been through a defacto first interview at the networking event. If you made a great first impression that new connection may reach out to you about the position.
Sudden unemployment is stressful, even with the various safety nets, like unemployment benefits, we have to help keep us afloat.
Knowing what to do when you're unemployed will help greatly in smoothing out this bumpy road. Actions like updating your resume, taking on side gigs or temporary work, ensuring you're getting the benefits you deserve and networking are key to getting through this downturn and coming through the other side stronger.
Now is the time to stand up, dust yourself off and get back into the world of the employed.