In uncertain economic times, business owners may put a freeze on hiring new employees in order to reduce expenses. In the worst-case scenario, they may feel pressure to downsize. While it may help balance the books, it may not always be the best thing for the health of the business.
Reducing the size of the workforce means that fewer employees are left to perform the work. As positions and responsibilities are consolidated, the remaining employees may become overburdened, stressed, and generally resentful of the added workload. This resentment is magnified if the extra work is not accompanied by additional pay.
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When employees are unhappy and feel that they are taken advantage of or exploited, they typically begin searching for new jobs. Replacing these employees can be costly, especially if they have many years of experience and long-term relationships with customers.
Hiring during a slow economy may actually be the optimal time. When unemployment is high, there are more people looking for work. They may also be willing to work for a lower wage than they normally would in order to avoid unemployment. This can result in the opportunity to add to the staff at a significant cost savings.
Remember that slow economic times never last. When the economy improves, employees will feel more confident and search for new jobs. Employees that are happy and feel appreciated will stick with an employer who treated them well during the difficult times. It is to an employer’s advantage to retain valuable employees, and to hire new ones in order to keep the workload balanced and to keep good employees from burning out.
