Worried About Headcount During a Recession?
Many company leaders are on recession watch in 2023.
A survey by consulting firm KPMG showed 91% predict a U.S. recession will occur sometime this year, and only 34% of the CEOs polled think it will be short.
Economists surveyed by Bloomberg put the chances of a recession in 2023 at 60%. With experts listing the probability of an economic downturn that high, and most CEOs considering it inevitable, one of the top priorities on every company leader’s agenda should be how to survive and thrive in an uncertain economy.
In times of economic uncertainty, small businesses are often hit the hardest. During a recession, it can be challenging for small businesses to survive and thrive due to various reasons such as the lack of available resources and unstable cash flow. However, partnering with a staffing company can offer several benefits to small businesses looking to weather the storm.
In this article, we will discuss how staffing companies can help small businesses during a recession.
What is a Flex-Force?
When you work with a staffing or employment agency, you are partnering with an organization to meet your headcount needs. And when you choose the right one, you will have a workFORCE that offers you the FLEXiblity to scale up or down quickly. Hence, the term FLEX-FORCE.
Technological advances embraced by organizations like Performance Personnel can offer you high quality workers when you need them, without you having to manage all of the HR, or worry about your unemployment insurance when it's time to scale down.
Using a 'Flex-Force' to Scale Your Workforce Offers Several Benefits:
During a recession, small businesses often face unpredictable fluctuations in workload, making it challenging to plan for the future. Staffing companies provide small businesses with the flexibility to scale their workforce up or down quickly, based on their changing needs. By outsourcing staffing requirements, small businesses can adjust their workforce based on the demand, without worrying about the costs of hiring and training new employees. This flexibility allows small businesses to stay agile and competitive during difficult times.
Hiring a full-time employee can be expensive for small businesses, as it involves various costs such as recruitment fees, training expenses, payroll taxes, and benefits. Staffing companies can help small businesses save costs by providing them with temporary, part-time, or contract-based employees who can perform the required tasks without the burden of long-term commitments. Staffing companies also handle administrative tasks such as payroll, taxes, and benefits, allowing small businesses to focus on core activities.
Access to Skilled Talent
During a recession, small businesses often have to cut costs by reducing their workforce. However, this can result in losing valuable employees with specialized skills and knowledge. Staffing companies can help small businesses access a pool of skilled talent, with expertise in various fields. Staffing companies have access to a vast network of job seekers, allowing small businesses to find the right candidates for their requirements.
Hiring new employees involves significant risks, such as the cost of hiring, training, and retaining them. Staffing companies can help small businesses mitigate these risks by providing them with temporary, contract-based, or part-time employees. This reduces the financial risks associated with hiring full-time employees and ensures that small businesses can maintain a stable workforce during times of uncertainty.
Even if we only come close to a recession in 2023, the reality is that current economic conditions still pose many challenges to companies, such as hiring challenges, employee retention, reduced budgets, and inflation impacting pay rates.
To achieve 2023 business goals, companies still need experienced talent on their roster. But the current economic environment may hinder your ability to add full-time headcount. In the case of needing to look outside of your organization to find qualified talent for expert or niche roles, consider using contract labor to augment your existing workforce. Contract workers can fill short-term, in-demand needs, or they can be added on a longer-term basis to help combat ongoing labor shortages. In either case, flexible, knowledgeable employees can help keep your business running in an agile, cost-effective manner.
Maximizing workforce efficiency should not come at the expense of overloading your workers. Companies must quickly assess and prioritize work and projects, ensuring they have the staff necessary to maintain critical business operations, as well as strategic projects that drive revenue and/or future growth. This prioritization process will help companies focus on the performance of what is most important, while maintaining employee morale during these challenging times. Additionally, this will help you understand where to strategically employ contract or part-time workers in order to fill remaining gaps.