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The Great Resignation Amidst a Possible Recession

By Christy Pruitt-Haynes

As we move towards what appears to be a possible downturn or recession, employees in certain roles should think twice before moving companies. Many organizations prioritize external facing and revenue generating roles like sales and marketing as well as positions in technology, so they tend to be more protected from possible layoffs. Positions in operation areas, like human resources (HR) and finance may be at a bit more risk. 

The other reason to think twice before joining the Great Resignation at this time is that many people are using that as an opportunity to leave the traditional workforce and opt to become an entrepreneur or join the “gig economy.”  For someone who plans to work as a business-to-consumer entrepreneur, that can be a little riskier because end users tend to be more conservative with their spending. 

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For some industries, the opposite is true if an entrepreneur plans to operate in a business-to-business enterprise. Companies will continue to have workforce needs and look for ways to have those met without adding to their bottom line, so for many the answer may be to replace a full-time employee who comes with salary, benefits and taxes for a contractor who is paid a flat rate based solely on production.   

Regardless of the market a person is thinking of joining, at a minimum they should work to secure contracts prior to making the leap because economic downturns have a lot of uncertainty.  
While there is some validity in last in, first out, the truth is many companies use that to first get rid of employees they were on the fence about. Layoffs and position eliminations often start with offering retirement to employees who are close to that point, especially for larger employers that tend to offer retirement benefits. The next group that is looked at is traditionally lower performers. After that, companies tend to look at those in duplicative positions. As an example, they are likely to take a department from having five customer service agents to having three. Newer employees are also absolutely at risk. 

It is important for new employees to add value as quickly as they can and often, they are in a great position to do so. New hires can bring in the skills they have developed in other organizations to revamp processes, provide insights into new ways of thinking, and offer unique perspectives on situations the organization may have been struggling with for a while.  If they are able to communicate their value early, it will help insulate them from any layoffs that may be coming. 

The Great Resignation was largely fueled by individuals re-evaluating their priorities. This is an excellent time for companies to re-engage their team members and find ways to unite the workforce. In those situations, we see companies come together to find creative solutions to avoid layoffs when there is an economic downturn. Employees will volunteer to take pay cuts or furlough to save the company money while also protecting their co-workers from lay-offs. However, only the companies that have developed a culture of collaboration and support will be able to benefit from those options. 

Christy Pruitt-Haynes, 20+ year HR expert and consultant at NeuroLeadership Institute.

Healthcare Business Today is a leading online publication that covers the business of healthcare. Our stories are written from those who are entrenched in this field and helping to shape the future of this industry. Healthcare Business Today offers readers access to fresh developments in health, medicine, science, and technology as well as the latest in patient news, with an emphasis on how these developments affect our lives.

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