Talks about a looming recession have been rife in many business circles. Economists and finance experts of major US banks such as JP Morgan and Bank of America predict a mild recession in the coming year.
77 percent of fund managers at Bank of America also predict an imminent economic recession in 2023. As inflation continues to soar, many investors forecast that inflation will dampen growth prospects for many economies in 2023 – especially the U.S. and Europe.
Meanwhile, JP Morgan economic experts foresee that the U.S. economy will shrink by 0.5 percent in the last quarter of 2023. This slump is expected to drag into the first quarter of 2024.
Moreover, analysts from Morgan Stanley believe that this period of stagnant growth caused by inflation and significant geopolitical issues, such as the war between Russia and Ukraine and tensions between China and Taiwan, will result in a substantial downturn as far as the employment industry is concerned.
This downturn will involve organizations letting go of their employees to save on labor costs and improve profits. A reduction in their workforce will significantly affect the unemployment rates and the gross domestic product (GDP) in the United States. Additionally, organizations have to reduce or eliminate budgets placed for growth activities. This will cause a reduction in productivity, slowing business growth and directly affecting the country’s GDP.
Amid these forecasts brought by economic uncertainty, employers and hiring managers face the challenge of securing their workforce due to the decrease in available positions and increase in competition, making it harder for organizations to attract suitable candidates.
Organizations know the value of secure employment, from entry-level to the C-suite. Hence, as an employer or leader, you need to act wisely and be very strategic about recession-proofing your workforce during a looming recession.
Recession-Proof Your Workforce Through Agile Methods
Forward-thinking organizations are now leveraging their workforce to anchor on agility and flexibility on top of better management of organization resources. This emphasis is vital for organizations to sustain growth and profitability and keep positions filled in the current market.
To recession-proof your organization in these challenging times, here are five actionable tips you should consider as an employer.
1. Prepare NOW for an economic recession.
One surefire way of lessening the impact of a recession is to revisit your budget and build up cash reserves, especially for your organizational savings. The key here is to spend less, save more, and get rid of debt as much as possible.
It would help if you also started building an agile workforce. Mass firing can hurt your employees and business. Hence, focus on hiring intentionally from hereon. If layoffs are on the horizon, consider pivoting to independent contractors and freelancers. The key here is encouraging and empowering employees to work efficiently while still keeping your employees in tip-top shape.
Moreover, it is essential to remain flexible and mindful of your organization’s day-to-day activities.
Ask yourself these questions to keep yourself on track;
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- Are there other revenue-generating strategies to be implemented?
- Are there new products and services to launch or bundle with existing ones?
- Are there untapped markets that are now ripe for tapping?
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Read more: Be Proactive in the Face of Disruptive Change
2. Focus on your employees.
In an economic recession, your employees will worry about secure employment. A win-win approach for both parties is to give employees the reskilling and upskilling they need to still be productive, efficient, and flexible during times of recession.
Through cross-pollination, your employees can take on new roles by learning new skill sets. Even when there is no economic recession, employees will be very appreciative of these opportunities to advance and secure their livelihood.
This will also ensure that your employees’ morale and engagement remains high.
3. Safeguard your customer base.
Organizations are typically diversifying during an economic crisis. While this is also a good strategy, keep focusing on your existing customer base.
You already have the loyal patronage of your existing customers, and you should never leave them behind during an economic downturn. Be sure to engage with them and maintain the same level of efficiency, if not more, when it comes to their work.
The key is to keep them happy. Delivering impeccable work will encourage them to continue working with you. They might even open a new market for you by referring your organization to their connections. Remember that their network is also vital to your success.
Offer discounts, promotions, and loyalty programs to your existing customers. Organize exclusive events for them. They should always be at the forefront of your mind and business strategy.
4. Focus on quality instead of quantity.
When quantity takes precedence over quality, the results can be hurtful to your organization– especially during an economic recession.
Employers who fall into the trap of prioritizing quantity tend to spend more on quality control. They also tend to spend more on product recalls and rectifying costly mistakes.
A period of an economic downturn is the best time to focus on your organization’s reputation and ensure that your products and services are the best in your industry. This also points back to the importance of reskilling and upskilling your employees during a recession. Do not make your workforce cheaper. Instead, make them irreplaceable. In the long run, your organization can look forward to reaping the many benefits.
5. Focus on organizational culture.
Your employees are your most valuable asset, whether your organization is in a period of growth or downturn. If they are unhappy, they will not be engaged or productive. And if they are not performing to par, your organization’s profits will stall.
When you focus on organizational culture instead of trimming expenses in every corner, you also earn respect and loyalty of your employees – especially your best-performing ones.
Studies show that organizations whose employees are happy are more attractive to candidates. Moreover, your employees would be delighted to refer your organization to other great candidates. They will automatically become an extension of your recruitment marketing team.
Furthermore, happy employees tend to stay longer. This means that you will also get to avoid hefty turnover costs. Moreover, your seasoned employees can mentor your new hires in their first few months in your organization. They get to model exemplary behavior, results, and overall performance – ensuring that your organization is recession-proof.
Read more: Leverage Your Competitive Advantage
STAY AHEAD OF THE CURVE WITH ACS PROFESSIONAL STAFFING
If you’re interested in seeing what a fulfilled and robust workforce can bring to your organization, contact our specialized team of recruiters at ACS Professional Staffing today! We can connect you with the best people in IT, engineering, finance, administrative support, and more. We specialize in direct hire placements, contract-to-hire staffing, and payroll services.
We champion the long-term success of your organization. You can count on us to help you stay ahead despite uncertain times. Contact us today!