Steering the employee ship through the economic storm

It’s no secret organisations have faced many business-defining challenges over the last three years. As businesses look to prepare for a potential recession, it becomes vital that they keep the heart of their business pumping: their employees.

While facing economic downturns, organisations need to ensure their employees are protected, happy and able to do their best work possible.

Dark economic clouds

The onset of COVID-19 has led to a series of supply chain disruptions and labour shortages, spiking the cost of living and disturbing the economy.

The signs of a recession are jumping out to businesses, as a recent survey by GoTo and OnePoll found 79 per cent of Australian business owners believe one will occur in the next 6 months. Seventy per cent of businesses are feeling nervous, and in turn, looking to prepare for an economic downturn.

A range of strategies is being implemented, with popular tactics including saving 3 months’ worth of profits, diversifying business cash flow, and consolidating technology. However, from a macro level, it is important businesses are prepared, calm and optimistic with strategies and goals while going through the process. Keeping employees front of mind will greatly ease upcoming challenges and ensure strong morale internally.

The state of the employee ship

Transparency is essential to employee wellbeing during economic downturns.

GoTo’s survey found 72 per cent of business leaders believe their employees can tell when a recession is going to affect their business, so it is important there is honest communication with staff to help build trust and cohesion within the workplace.

The current labour shortage has highlighted the value of employees, which thankfully has seen conditions and wellbeing improve for many staff. Business leaders are ensuring working environments are favourable, both at home and in the office, as 77 per cent believe it is vital employees are connected to IT support. These conditions have led to favourable outcomes for business leaders as 66 per cent of business leaders believe their employees’ morale has improved since last year.

However, what is most important, and reassuring to see, is businesses’ dedication to protecting employees as much as possible from economic uncertainty.

GoTo found 88 per cent of business leaders believe it is important to keep employees protected during economic downturns and 91 per cent believe ensuring the morale of employees remains high during economic downturns is critical. Eighty five per cent of leaders stated they will do anything in their power to retain employees through a possible recession, displaying that businesses understand the importance of a strong workplace during economic conflict.

Employees who trust their organisation will come together and drive the business through downturns, rather than jumping the ship that business leaders are trying to steer through the economic storm.

Navigating the ship through the storm

Economic factors have continued to shape and reshape the way employees choose to work.

GoTo’s survey found that 56 per cent of business leaders felt COVID-19 has impacted the way employees now work and act in 2022. Meanwhile, 41 per cent cited inflation and the rising cost of living as impacting employee choices with working. Furthermore, 20 per cent of business leaders believe the growing threat of cybersecurity has impacted work experiences.

The economy is being driven by a variety of different geopolitical trends, which eventually trickle down to place pressure on the workforce.

It is the business leader’s job to keep employees secure during economic turmoil. This means ensuring morale remains high, working conditions remain favourable and employee job safety remains front of mind.

This can be done through:

• An honest approach: Businesses that remain open and honest with employees during economic instability will reduce insecurity and instability amongst staff
• Ensuring organisational stability: Leading by example will ultimately bring peace of mind to employees during a recession
• Utilising the right technology: Technology has become integral to business and employee navigation during economic headwinds. Eighty-four per cent of Australian business owners believe ensuring employee devices are working properly is vital for being prepared for future issues, which coincides with the fact 71 per cent of employees are now updating employee devices annually

The economy will continue to be impacted by a variety of factors. As businesses prepare for the economic storm, it is imperative that employees remain front of mind with business decisions.

Communication remains the pinnacle tool for success, and by implementing the right technologies, focusing on improving morale and strategising for economic uncertainty, business leaders can steer the employee ship through the upcoming economic storm.

Lindsay Brown is VP of APAC for GoTo