In other words, if companies have to make their employees redundant they hire an outplacement agency that, for example, helps to draft resumes, offers career guidance or even provides practice interviews. Outplacement programs are implemented before the employees are laid-off.
The outplacement industry began in the 1980’s due to a wave of downsizing that swept the Australian economy. Losing one’s job is one of the most stressful events that can occur in a person’s life. Everyone reacts in a different way. Some can cope with the situation quite easily, others need help and guidance. Managers who offer outplacement support want to, on the one hand, boost the morale of those being laid-off, but on the other hand, send a signal to others that tough decisions have to be made and that redundancy is part of the company’s strategy.
After reading the above definition one would think that an outplacement agency is the same as a recruitment agency. However, recruitment and outplacement are based on opposing philosophies and market structures. Outplacement in today's environment is concerned with assisting people adjust to the change in their employment situation and deal with the complexity of career decisions. A career consultant ’s first and foremost concern would be to ensure the individual can successfully go through this difficult change. The recruitment industry, on the other hand, is based on finding the best possible person for a particular role. Their focus is on solving their client's "problem", that is, getting the right person for a job vacancy.
Is outplacement support really needed in a fast growing economy, where the labour market is full of job offers? According to management experts such support is needed regardless of the economic situation. A good example would be Japan, which is known for its lifetime emloyment, however more and more Japanese companies are performing badly and laying off employees. For many, it is the first time since they graduated that they have had to look for a job. For most of them it's even the first time that they have had to write a resume. Quite competent people are thrown into a severe state of confusion when they discover they are going to be jobless. It's the job of the outplacement agency to help them understand what is going on, what kind of person they are, and what type of job would suit them in the future.
