We are on the cusp of what many economists consider to be one of the strangest recessions since World War II. There are two guarantees during a recession: economic output decreases, and unemployment rises. What we are seeing in 2022 has one, but not the other. Unemployment not only isn’t rising, but it is also at its lowest levels since 2020—down to 3.6% in May of 2022.
Earlier this year, IC published a blog outlining how The Great Resignation required organizations to rethink how they can keep their workforce happy and boost retention. The job market was an employee’s dream, and many job postings were going unfilled and unanswered, with candidates finding jobs with better perks (remote work, salary, work-life balance). That hasn’t changed all that much. While certain companies, especially in the tech space, have said they will pull back on hiring, the job market as a whole is still at its strongest.
What is a recession vs an economic downturn?
You’ll notice that this essay did not use the word “recession” in its title, and that’s largely because: A) we are not in a recession yet at the time of writing, and B) what constitutes a “recession” can be a bit murky. The most popular answer to the definition of a recession is “GDP contracts for two consecutive quarters”. But the NBER does not always follow that rule (e.g., GDP did not contract for two quarters during the 2001 recession, yet the NBER still labeled it as such). But what has always remained constant is that unemployment has risen. It is yet to be seen if that trend will follow in 2022 and 2023.
With that in mind, many workers are worrying about job security at this time, and many still are considering taking on a new opportunity at a competing organization with higher pay—most likely fueled by the stagnation of wages compared to record-high inflation. It is our job as internal communicators to ensure that our workers are well informed about the inner goings of the company, and to provide both transparency and as much peace of mind as we can to employees, especially during an unprecedented economic downturn. Here are three suggestions for how you can do that.
1. Celebrate company goals
Your internal comms should be as celebratory as it is informatory. Now is time to make sure corporate wins are seen and celebrated, in order to boost morale and to let your employees now the ship is still well afloat. If employees are to think that the company is in trouble, they are more inclined to abandon ship, so ensure that good news is spread wide and loud, so that everyone can breathe a little easier, and stay motivated to continue delivering success.
While celebratory parties may be one of the first things you’re inclined to cut as budgets tighten, it’s important to still maintain these events to whatever extent possible. Fun company events (even budget friendly ones) keep a workforce happy, are a great way to let co-workers get to know each other (boosting collaboration at work), and are important in building a connection with employees that further incentivize them to stay.
2. Be transparent about how the economic downturn will affect your organization
During an economic downturn, budget cuts are increasingly likely, and that’s why it’s important to constantly be communicating with employees about what changes they may come to expect. As internal communicator, you must bridge the gap between employees and upper management (no easy feat)!
Work with executives to craft messaging that is clear and realistic about how this economic downturn will affect them. Will project budgets be cut? Will strategies pivot? Will bonuses be smaller? No employee wants to feel as if they’re in the dark, and not being clear about the changes ahead may motivate them to find new jobs—and don’t forget, we still are not sure whether this economic downturn will affect the job market, or if it will be immune to this potential recession. Whichever way it may go, open communication is the key to retention.
3. Know that employees may be struggling mentally
Inflation, economic downturns, and recessions all take a huge toll on the mental health of workers. Rates of depression and suicide increased during past recessions, and as prices increase due to inflation, more and more families may be wondering how they are going to be able to afford necessities like gas, food, and housing. It is important that you keep that in mind when building your internal comms strategy during this period. Employees may be more on edge than usual, and more prone to stress. Balance push and pull communications, and remember to manage the tone of your communications so as to not add to the stressors already affecting those around us.
Furthermore, you may want to take quick checks of your staff through anonymous polling in your Push messages, in order to understand the psyche of your workforce. Are people feeling burnt out, stressed, and anxious? If they are, that is insightful data to share with upper management, so that a plan can be created in order to assist the workforce through times like these and keep everyone engaged and happy.
Your partner for employee engagement
If you don’t have software in place to make your internal comms intuitive, now may be the time to book a demo and try Intranet Connections’ software. When you partner with us, you get more than just a product, you get an expert team who will help you hone the perfect internal comms strategy and help you every step of the way! Not ready for a demo? Check out our other free resources, like our HR Guide to an Engaged Workplace to help with your internal comms strategy!