Safeguards in a Slowing Economy
Economies are built on growth and, like anything else, experience growth in spurts. Although sometimes slowdowns can become contractions, slowdowns will occur eventually. Regardless of what the final calculations around recession reveal, a slowdown is playing out across the global tech industry. Luckily there are safeguards in a slowing economy every company can take advantage of, like those described in the article 5 Steps Employers Need to Take in a Slowing Economy by Phyllis Furman as reported by LinkedIn. Some highlights are featured below.
Don’t Rush Into Layoffs
Although layoffs may originate from the bottom line, it’s difficult to appreciate the true cost. Not only do companies lose productivity, but often the recipe to success. Here patience is not only a virtue but may also be a dividend. According to the article, “When you let go of workers, you lose some of your most valuable assets, individuals who have a deep knowledge of your business, market intelligence, and ties to your customers. In fact, researchers who looked at every company on the New York Stock Exchange from 1980 to 2016 found that employers that delayed layoffs as long as possible witnessed higher stock returns two years later than similar companies that let go of workers early on.” In addition, sudden market recovery and labor shortages can put a business in a tighter spot than before the layoffs. Continues Furmann, “The global economy is very volatile, and it’s difficult to predict what’s going to happen,’ says Matt Alder, the producer, and host of The Recruiting Future Podcast. ‘Companies need to think very carefully about laying off people because it may be that hiring people back is a very difficult thing to do.”
Handled the Right Way
Only chaos reigns when humaneness and empathy are left out of layoffs. The article continues, “There’s a lot at stake. Witness the fierce backlash against companies for laying workers off over Zoom or for outing them and sharing their personal information on social media networks. Airbnb has been praised for its handling of the layoff of one-quarter of its staff in May of 2020. Among the things Airbnb did right: CEO Brian Chesky sent a public message to employees that detailed how he made his decision and told workers who were leaving that it was not their fault. The company took steps to help departing staffers find new jobs, directing its recruiters to act as an outplacement team. Airbnb also created an “Alumni Talent Directory” where laid-off employees could choose to make their resumes and work samples accessible to potential employers.”
Activate Talent Acquisition
It’s easy to think that the recruiting team should also be let go if layoffs are happening. However, that’s the opposite of what needs to happen. Furman concludes, “During past downturns, employers have been quick to let go of their recruiting teams. But doing that could hinder your ability to compete for talent when the job market tightens.” There’s also more to do than direct recruiting. Furman adds, “A slowdown in hiring frees up time for recruiters to focus on important initiatives such as improving employer branding, nurturing relationships with future job candidates, and refining recruiting systems and processes.”
Whether growing or contracting, your recruiting team is vital to maintaining your talent pool and safeguarding personnel transitions that may occur.
Trent Lyons is a Technical Recruitment Lead at Business Centric Technology. If you are interested in learning more about how to get the best IT talent in the Dallas metroplex, contact Trent, who specializes in recruiting IT talent in Dallas, Ft. Worth, and North Texas. If you are looking for a rewarding career, contact us today.