It’s no secret that sooner or later, the economy will delve into a deeper recession. Hiring is already slowing at many companies, while others are going even further with layoffs.

It’s going to cause some serious challenges for HR – but it’s also an opportunity. If HR plays their cards right, a recession can actually be an opportunity to increase employee engagement and loyalty. After all, you never forget an employer who takes care of you during hard times.

Here are three ways HR can help their organization be best prepared for a recession:

Help Set the Right Tone

Many leaders, especially newer leaders or those who have never faced a recession, won’t know how to communicate effectively during this time. Communication is crucial to keeping your teams engaged and protecting morale – and HR must play a role in educating newer leaders on how to get it right.

When your teams are getting anxious and morale is sagging, it can be tempting to sugarcoat the situation – but that’s exactly what you SHOULDN’T do.

The best answer is to be upfront and honest with people. If you anticipate tight times ahead, help leaders be transparent with their team and let them know what options they’re considering.

People are smart. They’re reading the same news you are about a slumping economy, layoffs, hiring freezes, etc.

By being transparent, you show your teams that you aren’t sticking your head in the sand or ignoring the warning signs. It also helps them brace for what’s to come. Lastly, by communicating options, you demonstrate that you’re taking a proactive approach to the situation.

You can’t control the economy…but you can control how the company responds. Use communication to show your team you’re leveraging that for all it’s worth.

Help Communicate CLEAR Expectations/Deliverables

If and when you have to let people go, it’s a lot easier to make decisions when it’s clear who is meeting expectations and who is not.

Letting a team member go is always hard. It’s always going to be difficult news to the person in question. However, if they already know they weren’t hitting key performance metrics, it will come as less of a surprise and be a decision they’ll be more likely to understand.

It’s also good for the morale of remaining team members. They’ll understand that the layoffs weren’t arbitrary or based on office politics.

Unfortunately, most leaders and HR departments never take the time to set or communicate clear expectations!

We all do it for sales – but sales is easy. It’s quantifiable, we can break it down into numbers. What about roles like customer service, or operations?

HR must step in and help leaders set expectations upfront for all roles. When the economy sinks, we need to be prepared to hold each person accountable to clear expectations in order to protect the organization.

Educate Leaders on How to Navigate Tough Situations

The next recession is officially here and could get worse – so now is the time to give leaders the tools for success in a crisis.

You don’t want to be rushing to develop and educate leaders right when the economy takes a nosedive! HR can be invaluable in helping companies empower their leaders.

HR can help educate leaders that the WAY we make decisions matters almost as much as the decisions we make. They can train leaders on how to communicate effectively and transparently. They can also train leaders that in a rapidly evolving situation, it’s key to adjust course often to make sure we’re taking the right approach.

In 2020, at the height of the COVID-19 crisis and recession, I offered a Leadership in Crisis video series that walked leaders through how to navigate these difficult situations.

It draws on my 20+ years of experience as a CEO – including my time leading Qualigence through the Great Recession and the COVID recession of 2020. I explain how leaders can guide their team through these tough times, drawing lessons from my own successes AND failures!

Let’s Focus on What We Can Control

It’s easy to blame our problems on the economy. It’s easy to blame disengagement or low morale on X, Y or Z…but what if we instead focused on things we CAN control?

No HR team can wave a magic wand and fix the economy. But we can take steps to leave our business well-prepared for a recession – and weather it successfully when it does hit.

It’s time for HR to take matters into their own hands!

If you’re serious about solving key HR challenges no matter what, schedule a no-obligation call with our team today to learn about our performance solutions.