You can use gossip to benefit you and advance your career. The first word of advice is to listen to what others are saying, the second is do not add your voice to gossip.
__If there is buzz about a mass layoff, there may something to it. Even if the layoff does not happen when 'they' say it will, it is probably a good time to update your resume and think about what you would do if you were laid off. Do you have a game plan?
__Have you heard a rumor that another department is expanding or looking to hire new or more staff? If your human resources office has a bulletin board or shows position opening online, take some time to find out if the rumor is true.
__When asked your opinion concerning grapevine chatter, respond but be non-committal. If it's about layoffs, simply say something like "Layoffs are always bad, I hope it's not true."
__Never say to someone "I don't listen to gossip," because (a) the next gossip may be about you and (b) you may be tossed out of the loop and won't be told anything, good or bad.
__If pressed for a response, be very careful with your answer. It's better to say "Gee, I just don't know what to say about this." Just try not to say anything that can be taken out of context, you could very well become engaged in playing a miserable game of he said-she said. A response of, "Well, I am not surprised, because...," is never the way to go. There is nothing that you can say that will not be (1) misconstrued or (2) changed entirely by the end of the day. If you played the game of telephone in grade school you know that a whisper can change from one person to the next very quickly.
Become grapevine and water cooler savvy, make gossip work for you.
Read The Watercooler Effect: A Psychologist Explores the Extraordinary Power of Rumors. Check to see if your library has this book before you buy it. It is a quick and interesting read, but may not a book you want to keep, although you may want buy and pass it on to a friend to co-worker. Available from Amazon.com.