A management guide to outplacement services

Outplacement services in the U.S. were originally developed by the oil and gas industry in the 1960s. Outplacement is the assistance provided by a former employer to a dismissed employee in an effort to help that person find suitable employment, and may take the form of psychological counseling as well as job search assistance. Currently, outplacement in the U.S. is estimated to be a $125 million industry, and is growing 34 percent per year. The advantages of outplacement to the former employer and the dismissed employee are detailed, as are the disadvantages. The discussion focuses on the lack of proof that outplacement is the best or most effective method to use when discharging an employee; however, a recent survey of Fortune 500 firms indicated that 75 percent of the people who have used outplacement services have been pleased with the results.