The Positive Side of Unemployment

With the economy in turmoil, and companies wisely opting to downsize instead of going under, many of us are finding ourselves comfortably in our jobs one day, and surprisingly unemployed the next. Fortunately, the shock of unemployment has quickly worn off in the last few months, and most have at least considered the possibility, if not prepared for it directly in some way. Inevitably however, the reality of becoming unemployed can and does catch us off-guard, and throws us into a search not only for a future job, but also for current money.

One of the greatest things about being unemployed (and please don’t get me wrong, I am not a proponent) is that it is a gradual and forgiving process of adjustment, rather than a sudden and tragic event. For example, consider the alternative of having to deal with a sudden family death, and all of its related costs, when savings fall far short of what is needed. Within a matter of days, the event can set you back tens of thousands of dollars in debt and spiral your financial life out of control.

Unemployment is different. For many, although sudden and traumatic, a notice of unemployment often comes with a severance package, sometimes enough to cover at least a few weeks or months of expenses. Even if it does not, there are still ways to find quick cash. Unemployment does not explicitly add any large or unusual expenses to your budget (other than perhaps the health insurance payment). It simply takes away income that was previously there. The government offers temporary programs like unemployment insurance to help recover some of that loss and get through this difficult time.

Unemployment can be compared to a slow bleed, rather than a fatal gunshot. The process of adjustment is gradual. For families that have been saving a large percentage of their income over a period of time, a loss of one income may not be a hard adjustment at all. Although rarer than in previous decades, there are still many one-income families in the world. A savings buffer can provide a safety net until income is replaced, or you learn to live with less money.

Unemployment also has the amazing effect of forcing you to prioritize your income into what’s truly important and critical. “Needs” magically become “wants” and go by the wayside. Spending (inexpensively) on family is suddenly more important than shopping sprees. The end result when income is replaced is a more focused and aligned financial plan to a person’s true needs and goals.

Even more important than the financial aspects, I believe unemployment is a psychological milestone. I have read literature time and time again that claims jobs gained after unemployment are usually more fulfilling and pay better than those we were laid off from. This means that no matter how bad things look, the time away from work and the mental challenge of evaluating wants, needs, goals, priorities, and direction changes us for the better.

Although we would all like a positive outlook, it seems that unemployment will get worse before it turns for the better. If you find yourself unemployed, I can only hope that you maintain the self-awareness, hope, and power of choice that are common rights for all of us, stay positive, and focus on a better future for yourself and your family.

Photo by Carrie’s Camera

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