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Outplacement is a service provided, often by an employer, to assist laid-off employees in transitioning to new jobs by offering job search assistance and training. This service could include career counseling, resume writing, interview practice, and job placement. The goal is to help these employees find new employment more swiftly.


The phonetic spelling of the word “Outplacement” is /ˈaʊtpleɪsmənt/

Key Takeaways

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  1. Outplacement is a support service provided by employers to help former employees transition into new jobs. The service may include career counseling, resume workshops, interview coaching, and job placement assistance.
  2. Outplacement serves to enhance the employer’s reputation, maintain positive relations with former employees who might become clients or ambassadors, and mitigate the risk of litigation by demonstrating good faith and respect towards their staff.
  3. The effectiveness of outplacement depends highly on the quality of its provider; successful programs offer not only job search assistance, but also emotional support, helping individuals deal with job loss and maintain confidence during their job hunt.



Outplacement is significant in the business/finance realm as it refers to the support service provided by responsible organizations, often in the wake of layoffs or job loss, to aid former employees transition to new jobs and help them re-orient themselves in the job market. By offering highly beneficial services such as career counseling, resume workshops, interview practice, and targeted job search advice, companies are not only enhancing their reputation as being caring and considerate to their workforce, but also increasing the likelihood of former employees finding suitable employment swiftly. Therefore, outplacement is important because it can assist in reducing unemployment rates, improving company culture and demonstrating corporate responsibility, all while alleviating the stress and negative impact associated with job loss.


Outplacement is a support service provided to employees who are exiting an organization, typically as a result of layoffs or job redundancy. The core purpose of outplacement is to help these displaced employees transition to new jobs and re-orient themselves in the job market.The outplacement process generally involves services like career guidance, job searching assistance, resume writing, interview training and even counseling, all aimed at helping the former employee secure a new job as quickly and smoothly as possible. The intention behind offering outplacement services is also to maintain a positive brand reputation for the company itself, illustrating its commitment to employees’ well-being even in the event of unavoidable layoffs. By doing this, organizations aim to lessen the impact of job loss and help maintain morale among remaining staff.


1. Lehman Brothers Outplacement: When Lehman Brothers Holdings Inc. filed for bankruptcy in 2008, it caused the largest displacement of financial services and banking employees in history. Given the scale, an extensive outplacement process was necessary. Companies offering outplacement services were retained to coach those laid-off workers to help them transition into new jobs or even new careers. They provided services such as resume preparation, interview coaching, and job search strategy planning to ensure employees could secure employment elsewhere.2. General Motors (GM) Outplacement: GM has engaged in outplacement services several times in its history, particularly during periods of economic recessions or sluggish sales. For example, in 2018, GM offered outplacement services to the 14,000 employees it laid off. The focus was to provide these displaced employees with career counselling, train them for job interviews, and assist in job searches.3. Cisco Systems Outplacement: In 2016, Cisco Systems, a multinational technology conglomerate, announced it was laying off about 7% of its workforce (approximately 5,500 employees). To support these employees, the company sought the help of outplacement firms to guide the affected employees through the transition. This assistance included helping workers develop a robust professional network, enhance their resumes and cover letters, and improve their negotiation tactics for their next job.

Frequently Asked Questions(FAQ)

What is Outplacement?

Outplacement is a service that is provided by organizations to help laid-off or terminated employees transition into new jobs. This typically includes career counseling, resume writing assistance, interview practice, and job search guidance.

Why would a company offer outplacement services?

Offering outplacement services can be beneficial for companies in multiple ways. It can protect their reputation during layoffs, improve employee morale, reduce the risk of lawsuits, and help ensure that departing employees find new jobs more quickly.

How does outplacement benefit employees?

Outplacement benefits employees by providing them with professional support during a difficult time. This service helps them in improving their resumes, preparing for job interviews, and finding suitable job opportunities, thus accelerating their employment search period.

How long does outplacement typically last?

The duration of outplacement services vary based on the package provided by the employer. Some last a few weeks while others can last for several months.

Does using outplacement services guarantee a new job?

Although outplacement services provide assistance, tools, and resources to secure a new job, they cannot guarantee employment. The ultimate success of finding new employment also depends on the individual’s skills, qualifications, and efforts.

What services are typically included in outplacement?

Outplacement services typically include career counseling, resume and cover letter assistance, interview coaching, job hunting guidance, and sometimes, access to a database of potential employers.

Can outplacement services be offered to all levels of staff?

Yes, outplacement services can benefit all levels of staff, from entry-level to executive-level employees, although the specific services provided may vary accordingly.

Who pays for outplacement services?

The employer usually pays for outplacement services as a part of their severance package or as a goodwill offering during layoffs or business downsizing.

Are outplacement services valuable in different industries?

Yes, outplacement services have value across different industries. They are primarily focused on helping individuals transition to new work, regardless of their previous sector.

: Can an individual hire outplacement services independently?

: While outplacement services are typically offered by employers, individuals who are seeking such support can hire a career coach or similar professional independently.

Related Finance Terms

  • Redundancy
  • Career Transition
  • Job Coaching
  • Reskilling
  • Severance Package

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