How to Re-enter the Workforce After a Career Break

Here's how you can make things easier on yourself

Photo by Matthew Henry on Unsplash

Anyone who has followed my writing for any significant amount of time knows how often I hit upon the point that all wealth is built from income.

Most of my writing—and if we are honest, 99% of all personal finance writers—focuses on what to do with your income to build wealth and financial security. This is useful for those who make enough money to live a comfortable life. It’s less useful for those who barely make enough money to cover the bills.

You need to have money to be a good money manager.

A recent question in the Making of a Millionaire chat asked a crucial question.

“In the long run, I’d love to see more advice geared towards low-income lifestyles.

I’d love to get advice about things like how to land an entry level job with no experience, how to re-enter the “skilled” workforce after a career gap, and stuff along those lines”

This is exactly what I want out of Substack’s new chat feature. I want to build financial resources that help you with your most pressing financial problems.

In today’s post, I review some research to begin to tackle the question, “how to re-enter the “skilled” workforce after a career gap?”

Career gaps a much more common than you might think

If you have taken a career gap and are worried about how it might look to future employers, the first thing you should know is that you are in the majority rather than the minority.

A LinkedIn survey of 23,000 workers and 7,000 hiring managers found that 62% of employees have taken an extended break at some point in their careers.

There are all sorts of reasons people take career breaks.

• To upgrade their human capital through more education.

• Having kids

• Traveling

• Caring for sick family members

• Burnout

• To take care of their health (including mental health)

• Coming out of retirement

If you feel any type of shame for having a career break, I’d suggest step one should be letting that feeling go.

In this post on building financial optimism, I discussed the importance of being as kind to yourself as you are to your best friend. If your best friend told you they felt ashamed for having an extended career break would you comfort them or shame them further?

Be as kind to yourself as you are to your friends.

How extended breaks can impact your career

The difficult task for those re-entering the workforce is to hold two competing truths in their mind.

• First, career breaks are perfectly normal.

• Second, re-entering the workforce is not without its difficulties.

A 2021 paper examined the impacts of extended career breaks on income after re-entering the workforce. On average, those returning to a similar job are paid 7% less than they should be. Economists call this a “wage penalty.” That wage penalty goes way after 5-6 years, at which point returning workers begin to be paid fairly.

An interesting finding is that men who take career breaks experience a larger wage penalty than women, and it takes many more years for that wage penalty to go away. Hiring managers appear more forgiving to women taking time off than men.

This is evidence that economic gender roles remain deeply entrenched. If the corporate world still views men as the breadwinners and women as caretakers, it’s easy to understand why men would face a larger penalty for taking time off.

Which, of course, is stupid, but we live in a stupid world.

Let’s shift gears and discuss ways to make the return to the workforce as smooth as possible.

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Invest in your human capital

Not all of the wage penalty is attributed to the hiring managers' bias to punish workers for daring to take time off work.

We live in a time of rapid technological change. The methods and tools we use to work are constantly being updated. Imagine you’re an office worker who took a five-year leave of absence in 2017 and reapplied to your old job.

The day-to-day of your job would look a lot different. The HR rules have changed, the software you use to do your work has evolved, your daily tasks have likely changed, and what used to be an office job in 2017 might be a remote or hybrid job today.

For workers who have continuous employment, these changes are introduced gradually, and they receive time and training to adapt to these new circumstances. For someone returning from a five-year career break, they get thrown into the ocean without a life jacket.

The first step for anyone returning to the workforce after an extended break is to research how the work requirements have changed and what technical skills are required to excel in their desired job.

Depending on what kind of job you want, that might mean:

• Enrolling in formal education like a degree or certificate program

• Seeking out informal training like webinars and online courses about how to use Zoom and other recent software required for the desired job.

• Informal education, like YouTube university, career discussion forums, and reading blogs like the one you are reading right now.

How to frame your career break on your CV

After you’ve brushed up on the technical skills required for the job you want, you still have to deal with the fact that hiring managers may hold a bias against you for having a career gap.

It’s one thing to have the skills necessary to complete a job; it’s another to convince the hiring manager of that fact.

At some point, you will have to address your career break, but that doesn’t mean you need to lead with it. In a recent post, I highlighted the power of first impressions on human decision-making. If the first thing a hiring manager sees on your CV is that you took a multi-year career gap, that will inform how they process everything else you tell them about yourself.

Instead, start by highlighting how your skills align with the job requirements. Then, when they later learn about your career gap, they are weighing that piece of information against the fact that you are a skilled worker.

This can be difficult because the standard CV format is a chronological recounting of your career—this format will emphasize your career gap.

Instead, you may want to consider a skills CV format that focuses on your skills and life skills that you can bring to the job. Leading with your skills can help make a great first impression with the hiring manager, and they will be more likely to view your career gap in a more positive light.

Eventually, you will need to reveal to the prospective employer that you had a career break. What you don’t need to do is dwell on this fact or apologize for it. You can explain why you took time off work, what skills or lessons you learned during that time, and pivot back into your excitement for the role you’re applying for.

Leverage your social capital

"It's Not What You Know. It's Who You Know"

I write a lot about the importance of “human capital”—skills you acquire to make money. But, I haven’t written nearly enough about “social capital”—leveraging your relationships to advance your career.

We do not live in a meritocracy where people are hired and paid based purely on their skills. Corporations are governed by humans, and humans are a social species. Having a pre-existing relationship with a hiring manager—either directly or indirectly through someone you know—can be the deciding factor of whether you get the job.

Ask yourself, who do you know that might be able to help you land your next job?

• Do your friends have job openings at the company they work for?—Have you even told them that you are on the job hunt?

• Would any of your past managers be willing to write you a letter of recommendation?

• Don’t underestimate the power of LinkedIn. Reaching out to a key person at a company you want to work for is an underrated way to build your social capital.

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This is the first in a series of posts I will research on career development. What did I miss in this article? What career-related topics do you want me to write about in the future?

Head over to the Making of a Millionaire chat and let me know!

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This article is for informational purposes only. It should not be considered Financial or Legal Advice. Not all information will be accurate. Consult a financial professional before making any major financial decisions.