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Today I received the unfortunate news that the project that I and two others had been working on has been cancelled due to lack of funding, and that our services are no longer required. I was a junior in this role, and had been working for the company for five months. Fortunatley it was pretty obvious that redundancy was coming so I've been spending the last two weeks making inroads on finding a new role, and I have come up with a couple of companies who are interested in me.

The short amount of time I spent with my previous company is something that is worrying me. I'm afraid that I am going to look like a job-hopper or that I was just not suited for the role. I have been able to secure a good reference from the managing director of the company, but I'm worried that I won't even get that far if a potential employer sees five months of work experience on my CV and throws it aside. I am thinking of mentioning the redundancy on my CV but I honestly have no idea if that would be wise.

Has anyone else gone through something similar, or can anyone offer some guidance as to how I should tackle this?

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While this development is unfortunate, it is by no means a deal-breaker, and it won't harm your career.

If a potential employer likes your resume they will offer you the chance to explain that short timeframe, and a reference from your former manager will back up your story: that it was an unfortunate situation, and you were let go due to downsizing, not due to any mistakes on your part.

Don't lose any sleep over it. Good luck finding a new job!

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    +1 I would add that this is so common these days that hiring managers don't even blink an eye at it. Commented Aug 4, 2016 at 16:45
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If you are worried about your resume getting eliminated from consideration due to your short stay there just make sure your CV/Resume/Cover Letter includes information on why it was so short. Companies today understand projects get canceled and people get laid off as a result. I can't see any company holding a junior developer responsible for getting laid off when a project was canceled.

It could be as simple as Company XYZ, January - May (Laid off- Project canceled)

Patterns of short employment and frequent job hopping can be worrisome for employers but one isolated incident, even if it is your first job, really isn't a problem.

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Whenever I was doing contract work, I knew that the project could be canceled short of completion, especially Government contracts. I also occasionally took jobs that were only expected to be a short 60-120 day assignment because it was implementation of a single feature or fixing one issue, not a whole project. This is so common in IT that you simply tell the truth. Since your company will verify it if there is a check, you have no worries. I certainly wouldn't dismiss a qualified candidate for this sort of thing.

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