HR Management & Compliance

How to Lead During an Economic Downturn

Have you ever woken up and just didn’t feel like working? We’ve all been there. Work motivation is always challenging when most people have a million things going on in their lives. Add on the additional stress of a post-COVID world, including a looming recession, and it’s harder now than ever to find motivation. The market’s volitivity and constant doom-and-gloom news have many people steadily on edge and overall less confident in their careers and respective companies. The collective burnout has left many companies struggling to come up with new, meaningful solutions to engage their employees and teams. Figuring out where to start is difficult, but it doesn’t have to be.

It’s not just about numbers anymore. A people-first strategy can help companies surpass their competition. Focusing on workforce engagement with strategies that positively motivate teams and maintain productivity can be the key to a company’s success and survival. Here are strategies for employers to consider.

Consistent Communication

When in doubt, communicate. Leading with transparency and honesty in difficult times can breed loyalty and trust. You don’t need to share everything, but be direct. Deliver enough information to help ensure everyone feels included and that they’re part of the solution. Address the company’s situation and possible impact on teams, departments, or the company as a whole. Providing regular updates and feedback helps reduce anxiety and keeps workforces aware of progress, company goals, and future plans.

Prioritize Mental Health

Providing holistic support during difficult times distinguishes strong companies from the rest. Prioritizing employee wellness and mental health isn’t new for a lot companies, but concern in these areas has heightened. It’s smart to provide resources and outlets for employees to express their personal concerns and be reminded that it’s OK to be human and to have moments of struggle. This support can be in the form of resources, such as counseling services or employee assistance plans, flexible work schedules, and remote work options. Ask your employees what they need, and show that you’re open to discussing challenges that go beyond work basics. An environment where employees feel heard and valued builds positive company culture and increases employee engagement and productivity. Furthermore, it provides insight into what motivates employees and what they value most about the company. A short conversation can deliver long-term benefits all around.

Employee Empowerment

Empowering employees to take ownership of their work is key. Micromanaging is one of the top critiques sited when employees leave a company. Having independence, meaningful work, and thoughtful support demonstrates to employees they matter and fuels their motivation for growth. This might look like delegating valuable tasks and providing the necessary tools and resources to succeed. Encourage employees to take on new responsibilities and/or attend training sessions to develop new skills and capabilities or enhance existing ones so they continue to be a valuable asset going forward. Manage employees through clear key performance indicators (KPIs) and goal-setting that’s in alignment with the company’s business plan. Ensuring everyone has the right training, resources, and opportunities goes a long way to support employee retention and job satisfaction.

Encourage Innovation

During a downturn, employers usually look to cut costs to be more efficient. Instead, leaders may want to consider engaging employees to help come up with creative, innovative solutions to solve the challenges the company is facing. A strategy that includes your team in problem-solving may not only help the company’s overall performance but also boost employee engagement and strengthen teamwork values.

Positive Company Culture

A positive workplace culture allows employees to feel more connected and motivated to work toward shared company goals. Thoughtful actions that promote teamwork, collaboration, and open communication can help create that culture. Exercises like teambuilding activities, social events, and companywide challenges can take form in a variety of ways and help move companies toward better outcomes. Additionally, if company leaders share and contribute openly and honestly, employees will follow suit. 

These strategies can be helpful tools for creating an environment where employees are motivated and ready to contribute to the company’s long-term goals, even in difficult times. When employees know they are supported and appreciated, a company can emerge even stronger from an economic downturn. A people-first approach is always a good business strategy. 

Krista Mitzel is managing partner and Ronak Patel is senior counsel at The Mitzel Group, an integrated, San Francisco-based firm that uses the law as a business strategy to chart clients through all phases of their business life cycle. Mitzel can be reached at kmitzel@mitzelgroup.com, and Patel can be contacted at rpatel@mitzelgroup.com.

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