Workplace loyalty has value, but long-term employees should also maintain their skills, networks and career readiness.gettyMore than three out of four long-term employees believed their jobs were secure before they were laid off. That finding comes from a recent Careerminds survey of workers who lost jobs they had held for at least five years, highlighting how many professionals still view workplace loyalty and tenure as forms of job security. In today's labor market, however, years of service don't always shield workers from restructurings or unexpected layoffs.The survey refers to the hidden costs of that misplaced confidence as a "loyalty tax." Employees who assumed their commitment and longevity would keep them safe were more likely to neglect their resumes, professional networks and job search skills, leaving them less prepared when layoffs occurred. The problem isn’t workplace loyalty itself, but the belief that loyalty alone guarantees job security. Being committed to your employer and protecting your long-term career aren’t mutually exclusive. Here are seven ways workplace loyalty can create career risks and how to avoid paying a loyalty tax at work.Workplace Loyalty Can Create A False Sense Of Job SecurityThe survey found that 76% of long-term employees believed their jobs were secure or very secure before they were laid off, and nearly the same share thought their years of service would protect them from job cuts. For many workers, that assumption is understandable. Traditional ideas about workplace loyalty suggested that dedication and strong performance would provide a measure of stability.But layoffs are often driven by business priorities, restructuring efforts and economic pressures rather than seniority alone. Loyalty can still be valuable, but long-term workers should view it as a professional value rather than a job security strategy. Staying prepared for change, even when you feel secure, is one of the best ways to protect your career.MORE FOR YOUWorkplace Loyalty Can Lead Workers To Ignore Outside OpportunitiesThe survey found that 58% of long-term employees turned down one or more outside opportunities before being laid off because they believed their jobs were secure. When people feel settled in their roles, it's natural to ignore recruiter messages, skip industry events or assume they can always explore other options later.Keeping an eye on the market doesn’t mean you're disloyal or actively looking to leave. It means understanding your value, staying informed about industry trends and maintaining professional relationships that could help you in the future. The strongest careers are built on both commitment and awareness.Workplace Loyalty Can Leave Your Resume Out Of DateNearly half of survey respondents said they had allowed their resumes to become outdated while working for the same employer. After years in one organization, it's easy to postpone documenting accomplishments because there seems to be no immediate need for it.Unfortunately, waiting until a layoff occurs makes the process much harder. Professionals should keep a running record of major projects, measurable results and positive feedback throughout their careers. Updating your resume once a year is far easier than trying to reconstruct years of achievements under pressure.Workplace Loyalty Can Shrink Your Professional NetworkThe survey also found that more than 53% of respondents had allowed their professional networks to fall into partial or complete disuse. Many long-term employees invest heavily in internal relationships while gradually losing touch with former colleagues and industry contacts.Networking shouldn’t begin when a job search starts. Staying connected to people outside your organization provides perspective on industry changes, exposes you to new opportunities and creates a support system if your circumstances unexpectedly change. Career resilience depends on relationships that extend beyond a single employer.Workplace Loyalty Can Leave You Unprepared For A Job SearchOnly 13.8% of respondents said they could have immediately applied for new roles using the resumes, contacts and job search skills they had when they were laid off. The job market evolves quickly, and professionals who have been in one position for many years may find that hiring practices and expectations have changed significantly.Today’s job seekers must navigate LinkedIn visibility, AI-powered recruiting tools and new interview formats. Staying familiar with these trends, even when you're happily employed, can reduce stress and shorten the learning curve if you ever need to make an unexpected transition.Workplace Loyalty Can Increase The Shock Of An Unexpected LayoffThe emotional impact of a layoff can be especially severe for long-term employees. According to the survey, 66.3% of respondents said they were shocked by their dismissal, while nearly one-quarter said they had considered it unthinkable. Years of service can create a sense of permanence that no longer exists in many organizations.Work is an important part of identity, but it shouldn't become your entire identity. Building interests, relationships and professional confidence outside your current role can make career transitions less overwhelming and help you adapt more quickly when circumstances change.Workplace Loyalty Can Keep Your Skills From Staying CurrentLong-term employees can become deeply skilled in their organization's systems and processes while gradually losing touch with what the broader market demands. Rapid changes in AI, automation and digital tools mean that skills can become outdated more quickly than many professionals expect. That can become a hidden risk if their role changes, their industry evolves or they suddenly need to compete for outside opportunities.To avoid this loyalty tax, periodically compare your skills against current job postings in your field. Pay attention to recurring tools, technologies and qualifications, then identify one or two capabilities to strengthen before you actually need them.How To Avoid A Loyalty Tax Without Giving Up Workplace LoyaltyAvoiding a loyalty tax doesn't mean becoming cynical or abandoning workplace loyalty altogether. Loyalty still matters, and long-term employees often bring valuable institutional knowledge, strong relationships and deep expertise to their organizations. The goal is to balance commitment to your employer with commitment to your own long-term career security.That balance matters because research published in the Journal of Business Ethics suggests that highly loyal employees may sometimes feel pressure to accept demands that other workers would be more likely to question. Healthy workplace loyalty means staying committed to your employer while continuing to invest in your resume, professional relationships and skill development. In today’s labor market, career security depends less on how long you’ve stayed and more on how prepared you are for whatever comes next.If you're tired of generic career advice and want practical insights on navigating layoffs, toxic bosses, job searches, career transitions and AI's impact on work, subscribe to my free newsletter, Corporate Escape Artist. Join more than 10,000 professionals receiving weekly career insights and strategies.