Layoffs Turn Into Opportunity for Ex-Managers : Employment: More executives who have been cut out of the big time are going into business for themselves.


When Tony Quiroga received his termination notice from Clairol Inc. last year, he quickly found a new employer: himself.

Quiroga, a former factory manager at the leading beauty products firm in Stamford, Conn., decided to ditch the corporate mainstream and start his own small business.

Now he sets his own hours and signs all the checks for a franchise branch of Mailboxes Etc., an office products and postal services chain, in the nearby town of Fairfield.

Quiroga’s new life hasn’t freed him from worrying about the amount of cash in the bank. Accustomed to company health plans after 19 years, he panicked when his 17-year-old son got hurt a month ago and had to be rushed to the hospital. He wasn’t sure if his wife’s insurance policy would cover the bill.


Nonetheless, Quiroga said, he likes running a small business. So, apparently, do other former executives who have started their own companies after losing jobs in corporate overhauls.

Thousands of lower- and mid-level executives have been laid off in the dizzying era of mergers, takeovers and restructurings that have reshaped the face of corporate America in recent years.

The National Planning Assn., a Washington-based business research organization, estimates that plant closings and other corporate staff reductions have displaced 2 million workers a year since the late 1970s.

Most of the executive victims have sought jobs with other businesses, where they find comfort and security in a steady salary and benefits, said Joan Learn, president of the Greenwich Group, an executive counseling firm that encourages clients to consider self-employment.


But evidence suggests that a growing number of these people are viewing pink slips as golden opportunities to become their own bosses, selling everything from flowers to computer software.

Part of the reason, experts say, is the insecurity that layoff victims feel by going to work for someone else again.

Challenger, Gray & Christmas, a Chicago-based consulting and executive placement company, estimates that the number of laid-off executives who have become entrepreneurs has tripled in the past five years, from 7% of the total in 1985 to about 20% today. The company bases the estimate on its own quarterly surveys of 600 displaced managers around the country.

“There is no question that a prime factor in the decision to become an entrepreneur is concern over another discharge,” said James Challenger, company president. “These people are hoping to guarantee that they will never again hear an employer tell them they no longer have a job.”


Kathleen Purdy walked down both career paths when she was laid off as director of internal management consulting for Infilco Corp. of Meriden, Conn.

She started looking for new jobs with help from Learn, but she also drafted a plan to form her own consulting firm.

Purdy chickened out when it came time to launch the plan, instead accepting a job as a marketing director for Onsite Energy, a subsidiary of PacifiCorp. in Portland, Ore. But when she got laid off from that job two years later, she took the plunge.

“I decided to go for it, and I’m just delighted,” said Purdy, whose consulting firm opened in January. “It’s working out very well.”


Going it alone isn’t always easy for the corporate type, however, especially middle managers who have staked their professional careers on loyalty to a well-established business with thousands of employees.

“You miss the camaraderie of your associates. You miss the second-family society that a large company has to offer. You make a lot of good friends when you’re working at large corporations,” said Dan McCarthy, a former senior executive at Pitney Bowes Inc., a leading office-equipment maker in Stamford.

McCarthy left the company on his own last September when it announced a restructuring that watered down his job, and he is just getting started running a franchise branch of Remedy Temporary Services, an employment agency.

Many displaced executives find that they must adjust their focus away from expense accounts and profit-and-loss statements and toward concern for their customers, whom they are often meeting face to face for the first time.


“Having been senior management for the last 18, 19, years, there is a management syndrome you have to be careful of--you can’t just sit at your desk and feel you’re going to be firing off a lot of orders to people,” said McCarthy, who spent 29 years at NCR Corp. in Dayton, Ohio, before he went to Pitney Bowes and then ventured out on his own.

“There is a big difference in coming out of a corporate structure, where things are much more formalized and there are many long meetings and a certain amount of politics that exist in every company,” he said. “That’s fine for that way of life, but it doesn’t work for the entrepreneur. You have to keep the customer in mind every time.”

Many former executives who turn to self-employment say they find a new source of energy and excitement in their layoff afterlife that compensates for the anxieties.

“I’m getting more of a kick out of doing this than I’d ever anticipated,” McCarthy said. “It allows me to bring forth all the experiences I had in the past and use that effort and energy on my own behalf.”


Learn, who runs the Greenwich Group with her husband, said the firm has grown steadily since its founding four years ago, largely because of corporate restructurings and growing interest in self-employment. They estimate that they will help 300 to 400 people from 50 to 60 companies this year.