To put it politely, the UK’s economy could be described as being in the toilet. First, the pandemic brought the country to a near standstill, causing thousands of businesses to go under, never to be seen again. Then, just as the situation with COVID was beginning to look a little brighter, Putin decided to invade Ukraine, placing the UK’s food and energy supplies under serious threat, and causing prices to soar. Now, the nation is in the throes of a crippling cost-of-living crisis, which is inflicting untold pain on households and organisations from Lands’ End to John o’ Groats.
It is understandable why many businesses have rushed to panic stations in light of the dire financial situation. With so much uncertainty in the economy – and inflation remaining very high – companies are being hit by astronomical operating costs that pose an existential threat to their future prosperity. As such, budgets are being guarded as tightly as the gold reserves at Fort Knox, with every penny spent requiring sound justification.
This, in turn, is causing companies to make incredibly difficult decisions about where they feel they need to cut back on spending. Time and again, this translates to ‘streamlining’ – i.e., putting new hires on pause, as well as laying off existing staff whose roles are not seen as mission-critical. However, taking a scattergun approach to getting rid of talent during an economic crisis is rarely a smart move, and is a decision that often comes back to bite companies on the backside further down the line.
Relax, don’t do it…
It might be easier said than done, but the best thing firms can do when times are hard is not panic. Of course, it is only natural to do so when your business is on the line, but panicking has never served to do anything but make a problem that much worse. Instead, you are much better off taking a calm and measured approach to the situation, and carefully devising a plan around how you intend to weather the storm.
Running around like a headless chicken is only going to impair your ability to make reasoned decisions for the good of the business and all who work for it. It’s in times of crisis that you can truly show what a strong and dedicated leader you are, and that you are not only committed to preserving the future of your business, but also the livelihoods of your staff too. After all, people are the most valuable asset to any organisation and, without them, the situation is likely to get much worse before it gets better – if it get better at all, that is.
Throwing the baby out with the bathwater
Amid the economic downturn, the UK has seen a record number of job vacancies in the last few months. This means that, if you decide to lay your talent off, those individuals are likely to be snapped up by a competitor before you can say: ‘buyer’s market’. Clearly, you hired them in the first place because you saw something in them; a level of potential that put them a cut above other candidates. Do you really want to let talent like that slip through your fingers and into the hands of your competitors?
Before letting anyone go, therefore, you need to think long and hard about whether the firm will genuinely be better off with fewer people in its employ. Of course, there may well be those working for you who consistently aren’t pull their weight, and are merely holding the company’s growth back further. As unpleasant as it might be, it may be necessary to let these people go, but taking a strategic approach to laying staff off is key. After all, you don’t want to get rid of your top talent as well, not least because this could have a negative implication for team morale. If employees start to see good people being let go, they may start to question their own position, and whether they’d be better working for someone else who understands the value in retaining talent.
While it’s unrealistic to believe that lay offs are never called for during an economic crisis, taking a delicate approach to who goes, who stays, and the optics of it all, is crucial.
Despite current financial uncertainty, the war for talent is continuing to rage, with many organisations keen to scoop up talented individuals who can help them to grow, and overcome the adversity they are facing. As such, you should be thinking not only about retaining your existing staff, but welcoming new members to your team as well.
With so much competition out there, however, it can be difficult to make your business stand out from the crowd. Something that bosses often neglect when looking to attract new workers is the importance of company culture as a key marketing message. Sure, an appealing salary and a fancy-sounding position might make for obvious lures, but when it comes down to it, they can be a little hollow. People spend so much of their lives at work, so being with a company where they feel happy, valued, and engaged is truly worth its weight in gold.
While there are many things that you can do to express your company culture, encouraging staff to share their positive experiences on sites like Glassdoor, or posting regular updates about what’s happening in your office on social media, are great places to start. The more that you can do demonstrate that yours is a fun and exciting place to work, the more you are likely to stand out, and candidates will come flocking to you as a result.
Your employees are your greatest brand ambassadors
Rather than viewing your employees as a problem – or a barrier to achieving financial stability – start seeing them as a solution instead. As mentioned above, getting rid of staff as a means of overcoming a short-term economic challenge is not necessarily a wise decision – and could even dissuade people from applying in the future. After all, how you treat your staff during the hard times is likely to speak volumes to many would-be candidates about your leadership, and give them pause for thought.
It is much better, therefore, to do everything possible to keep hold of your employees, and consider the power that they possess to help navigate the business through the crisis. There are no better ambassadors for your organisation than those working for it and, as ever, investors invest in people, rather than ideas. Whatever your team can do to help promote the business, and to achieve successes amid rough seas, is likely to attract new talent to your company, and provide much-needed confidence in its longevity.
It is undeniable that the UK is experiencing one of the bleakest economic crises in living memory, but rather than throwing employees overboard, business leaders should be battening down the hatches, and keeping all hands on deck.
Alexander Dick, CEO of Alexander Lyons Solutions