Many company leaders are on recession watch in 2023.
A survey by consulting firm KPMG showed 91% predict a U.S. recession will occur sometime this year, and only 34% of the CEOs polled think it will be short.
Economists surveyed by Bloomberg put the chances of a recession in 2023 at 60%. With experts listing the probability of an economic downturn that high, and most CEOs considering it inevitable, one of the top priorities on every company leader’s agenda should be how to survive and thrive in an uncertain economy.
How can you as a leader plan for a recession, or any crisis for that matter? Much of it comes down to creative problem-solving—considering new alternatives to help you take control of your business when things largely out of your control disrupt it.
Working with a Staffing Agency
Along the lines of approaching problems differently than you have in the past, of thinking more outside the box, consider your personnel decisions. Not only staying afloat but riding a growing wave of success in challenging times depends on the people you lead—how you go about finding them, deciding who stays, and blending temporary workers with permanent ones.
The COVID era thrust massive changes across all industries, and leaders who didn’t adapt found their businesses in trouble. Remote work and greater customer dependency on digital shopping forced them to discard old ways of thinking and consider new types of solutions.
In terms of hiring and retaining the types of talents that propel company growth, the “Great Resignation” has caused a re-evaluation of those dynamics and consideration of approaching them differently. The Great Resignation is real; over 46 million people left their jobs in 2021, and the average cost of hiring and onboarding an employee is $4,700. Staffing challenges have the ability to negatively impact your budget and your bottom line. Given staffing gaps and an unpredictable economy, it’s more important than ever to think strategically about how to use budgets efficiently and effectively, and in that context, it’s imperative that leaders take the time to look into their current staffing situation. Key points to consider when doing so include:
- You should have the right leaders in place to maintain focus on the goals and priorities of the company.
- Do what you can to retain your top talent.
- Inquire about whether your teams are being productive and delivering at the level they need to be to advance your goals.
Opportunities to outsource and make your operations run more efficiently from a cost perspective can help you scale wisely to mitigate the need for downsizing. Working with a staffing partner is a cost-effective way companies can find talent when you most need it and meet business goals.
Your business is unique, and some staffing companies understand that your personnel needs require flexibility, particularly in today’s economic environment. Those staffing companies that offer contract, contract-to-hire, and permanent placement options can help you find employees that best match your evolving staff needs and budget. From setting 2023 targets across departments to re-evaluating work processes, vendor relationships, and even shareholder accountability, organizations have many operational facets to consider. To alleviate some of the burden, a strategic talent partner can help you right-size your workforce and achieve the best balance of full-time and contract employees.
Advantages of a Contract Workforce
Even if we only come close to a recession in 2023, the reality is that current economic conditions still pose many challenges to companies, such as hiring challenges, employee retention, reduced budgets, and inflation impacting pay rates.
To achieve 2023 business goals, companies still need experienced talent on their roster. But the current economic environment may hinder your ability to add full-time headcount. In the case of needing to look outside of your organization to find qualified talent for expert or niche roles, consider using contract labor to augment your existing workforce. Contract workers can fill short-term, in-demand needs, or they can be added on a longer-term basis to help combat ongoing labor shortages. In either case, flexible, knowledgeable employees can help keep your business running in an agile, cost-effective manner.
Maximizing workforce efficiency should not come at the expense of overloading your workers. Companies must quickly assess and prioritize work and projects, ensuring they have the staff necessary to maintain critical business operations, as well as strategic projects that drive revenue and/or future growth. This prioritization process will help companies focus on the performance of what is most important, while maintaining employee morale during these challenging times. Additionally, this will help you understand where to strategically employ contract or part-time workers in order to fill remaining gaps.
3 Strategies to Help You Hire during a Recession
- Conduct a skills gap analysis: This will help you identify a skill set your workforce needs but doesn’t necessarily have. A skills gap analysis can create opportunities for training and advancement and show you where your funding is needed for new technology. It can also help ensure your workforce has the skills necessary to meet future client demands.
- Recruit remotely: Many business owners may believe they don’t have the resources to hire during a recession. However, you can have success by hiring remotely. Considering candidates all over the map greatly widens your pool of available talent. Remote workers often cost less to hire and bring a diversity of skills to the table. To fill an open position remotely, make sure you have the right tools in place. Many experts also encourage doing a remote reference check and providing remote onboarding resources to help new hires get up to speed quickly.
- Communicate what you stand for: While considering the value your candidates bring, be sure to demonstrate your own value as a company and employer. Clearly communicate why your organization is a great place to work and how you’re different (and better) than other businesses competing for the same talent. During a recession, employees may be reluctant to leave the safety of their current jobs, so you might have to ensure they are in good hands.
In an uncertain economy and with recession a real threat, resource allocation and workforce balance are more important than ever. Obstacles, such as a recession, are inevitable, but can be overcome by the decisions you make as a leader, and especially, by the avenues you take to get the most out of your workforce during such critical times.
To learn more about how Medix can support your organization during times of economic uncertainty, get in touch with our team today.