Common Job Scams and Ways to Avoid Them
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With layoffs hitting a two-year high in 2023 in the United States, there is a rise in the number of professionals looking for a job. In 2022, there were 15.4 million layoffs across the country, with companies like Meta, Alphabet, and Apple laying off several employees. Layoffs continued in 2023; we saw 180,713 job cuts in January and February.
Unfortunately, the massive layoffs have also caused a rise in job seekers getting scammed.
Job scams have been around for a long time, but the recent layoffs have led to a rise in scams. Scammers are using different tricks, from asking for personal information to asking for payment. This article explains the red flags to look for and shares the best ways to avoid scamming.
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What are job scams?
Employment scams occur when scammers pose as reputable companies and post fake job descriptions on websites that look genuine. Then they make fake job offers to job seekers and sometimes ask for money. Such scams have become more sophisticated and often appear as genuine recruitment activities which reach you through a direct email or a third-party website.
Types of job scams
Let’s look at the different types of scams you might encounter.
Work-from-home job scams
One of the most common job scams is the work-from-home job scam. Many people like to work from home, and scammers know this. They place online job ads and claim they have jobs where it is possible to make thousands of dollars monthly by simply working from home at your preferred hours. This means little effort and little time but a lot of money.
The job could involve selling things to people, filling out forms, or reshipping products. Some scammers try to convince you by saying that the job allows you to be your own boss and set your schedule. While this might seem attractive, you could pay for useless training or starter kits. It is a scam if someone offers you a job where you can make a ton of money with little work.
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Reshipping and reselling scams
Offered as a part of the work-from-home job, you will be asked to receive packages at home and discard the original packaging with receipts. You will now get a new address where you need to send the repackaged products. The address could be domestic or overseas, and the products are high-priced goods bought using stolen credit cards. This is not a real job and only a scam.
Once you start reshipping goods, you never get a paycheck, and if you try to contact the company, the phone number will be deactivated. If you have given your personal information thinking it is for the payroll, you could have an identity theft problem now.
Another common scam is reselling merchandise, where a stranger will contact you for the job and tell you that you can make money by purchasing luxury products at low prices and then selling them at a profit. However, the package will never arrive once you pay for the products.
Virtual personal assistant job scam
You might find several fake job ads for caregivers, nannies, and virtual assistants on different job sites. They also send emails that look like they are from someone in the community, and if you apply, the person hiring you will send a check and ask you to keep a part of it and send the rest to somebody else. It is a big scam. A genuine employer will not ask you ever to do that. It is already too late when you notice that the check is fake.
Mystery shopper scam
Isn’t it a dream job to get paid to shop? Yes, mystery shoppers are legitimate, but many are scams. This is why you should not believe everyone who offers you a mystery shopper job. A real company will not ask you to pay for job guarantees, certifications, or even directories of jobs. If they do, it is one of the warning signs of a scam.
Government job scams
Many job seekers look forward to landing a government job and often respond to an ad that promises jobs in the postal service or with the federal government. However, you will then be asked to pay a fee for the job or to pay a fee for the study material, and this is a sign of a scam. Details about the job openings with the government or postal service are available to everyone, and it is free to apply for them.
Job placement service scams
There are many agencies, staffing companies, headhunters, and placement firms that are genuine but others that lie about what they offer you and what they could do for you. Such companies promote fake job openings or charge fees for their services. Legitimate firms will never charge a fee. Instead, a hiring company will pay them a fee to find qualified candidates, so if a firm asks you for a fee, walk away because it could be a scam.
Red flags to watch out for
So, if you are in the market looking for a job, here are some red flags you need to watch out for when reviewing opportunities.
Minimal details but a flashy job post
When you are in the job seekers market, you will see that employers are trying their best to stand out. However, if you come across a job posting about making quick money and big promises, you must see it as a red flag. Something fishy happens whenever the job ad uses terms like quick money or seems too good to be true.
Even if it has few requirements and a solid pay scale, it might not come across professionally and is best avoided. If you are not sure about the legitimacy of the job post, you can verify it by visiting the company’s website and seeing if the opening is posted there.
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They do not have answers to your questions
It might be exciting to get a call from the recruiter, but you need to make sure that they are actually who they claim to be when you have not applied for the job, be-specially. Always focus on the type of questions they are asking you. It is a red flag if you notice that they are quickly offering a job without verifying your qualification or experience and moving quickly.
Whenever you notice that the job description is vague, asking for more details about the role, expectations, and experience is important. If it is a scam, they will run away from you and will not be happy to answer any questions, and if they give inconsistent answers, you need to take it as a sign that it is not a real job. Scammers often fraudulently use a company’s name and address, so you must check if their email is legit. If you see that the domain name is strange, it could be a scam.
They want your personal information
All job applications require your name, address, work experience, and basic contact information, but it is a red flag if they go much deeper than that. When they ask you to provide personal information right at the first stage, like your Social Security number, it should ring a bell.
No company will ask for your Social Security number in the initial stage. If they do, it should only be after you are hired. Before giving out any personal details, you must perform online research. Search for the company name or the person who contacted you. Do not trust the reviews on the company website since they can all be fake.
They ask for money
The only discussion about money with an employer should be the compensation for the job. But if you are asked to pay fees upfront or for training or equipment, it is a scam. Never pay for the promise of a job, and do not make the mistake of paying upfront for a job since a legitimate company will not ask for money. Another fake scam could involve the company sending you money to buy a laptop and asking you to repay the extra funds through gift cards or a wire transfer.
Ways to avoid a job scam
Here are a few steps you can take before you pay anything or accept a job offer from a potential employer.
- Conduct online research. Always check the company's name or look for the person hiring you on LinkedIn. Search Google using the company name or the hiring individual’s name and add a word like a scam or review and you might find out if they have scammed others in the past. You can also check out the company on Better Business Bureau before you proceed.
- Never pay for the promise of a job. A genuine company or legitimate employer, including the government, will not ask for money to give you a job. If they do, it is a job scammer.
- Do not bank on a “cleared” check. An employer will not send you a check and ask you to send some money or buy gift cards. It is known as a fake check scam, and it will bounce, so you will have to repay the entire check amount to the bank.
- Do not believe generic emails. All job scammers are trying to reach out to as many candidates as possible with little or no information. Hence, if the emails seem very generic, stay away from them.
- Wrong email addresses or incorrect domain names. Check for the correct email addresses and domain names before you apply for a job. If it sounds strange and inappropriate, it probably is.
- Job promise without a physical interview. All recruiters ask for an in-person interview or a virtual interview. If you are offered a job without one, it could be a scam.
- They ask for financial information. Whenever a recruiter asks for sensitive information, it could be a scam. No legitimate company will ask for payment to apply for a position since it is never a condition of employment. Even the background check is paid for by the company and not the candidate.
- Too good to be true. When you come across a posting on the job board or on social media with very high compensation for a position that needs little experience or skills, it could be a fraud.
What to do if you have been scammed?
If you have paid through a wire transfer, credit card, gift card, bank transfer, or debit card, you need to contact the company you used to transfer the money immediately. Do not waste any time and report the fraud immediately. Ask to have the transaction reversed. If you have lost money to a job scam, you need to report it to the Federal Trade Commission.
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FAQS
How can I check if the company is real?
The best way to verify a company is legitimate is to check out its website, address, and phone number. If possible, visit the company's physical address and talk to people there. If not, search for the company on social media and search for the people working there.
How to tell if the company is actually hiring?
If it is a legitimate company and is actually hiring, you will see the job posting on its website in addition to the job boards or social media. Besides that, you will also see the hiring manager communicate with you professionally and will not try to sell you to the company. If selected, you will be asked to appear for a physical or virtual interview, and no hiring manager will ever ask for money for the process.
How do I avoid a job scam?
The best way to avoid job scams is to research the company, never give personal information, and trust your instincts. If it is too good to be true, it probably is.
The bottom line
Job scammers are always on the lookout for the next victim, and if you find a suspicious job posting, take the time to research. No matter how desperately you are looking for a job, do your due diligence and do not fall into the trap of making quick money.
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Writer
Vandita Jadeja is a financial writer and editorial assistant at Joywallet. She loves to read and write about money and brings 7 years of experience from the financial industry. She loves coffee, mountains and sunsets.
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