The economic impact of the COVID-19 pandemic has been tremendous. Businesses around the world are shutting down as lockdowns are being put in place and the supply chain is slowly falling apart as logistics slow to a crawl. It is clear that the global economy is heading into a recession that could potentially be even more devastating than the 2009 global financial crisis.
While several countries are reporting improvement in terms of new COVID-19 cases, they are still erring on the side of caution, as things may still get worse if they become complacent. This means that economically vulnerable nations are still at risk and may require more help to stabilise.
The International Monetary Fund (IMF) chief, Kristalina Georgieva, has already revealed that over 80 countries have already requested emergency aid from the IMF.
In recent weeks, many governments around the world have put in place financial stimulus packages in preparation of the recession.
The UK has released four emergency packages that target various affected groups, totalling £65.5 billion (US$81.6 billion).
European governments announced economic rescue packages worth a combined €1.7 trillion (US$1.8 trillion) to combat the effects of the coronavirus pandemic.
Singapore unveiled a S$48 billion (US$33.9 billion) ‘resilience package’ of measures to aid workers and businesses, with more targeted help for those hardest-hit by the pandemic. Combined with the nation’s earlier financial packages, the city-state will be setting aside close to S$55 billion (US$38.9 billion) for its ongoing battle against the pandemic.
While governments of the world are rallying resources to mitigate the effects of COVID-19, the impact on the individual level can still be seen as stressful.
Layoff anxiety is a very real issue leading up to and during a recession. It is pervasive among workers and is usually fueled by three main factors: fear of recession, office rumours, and recent layoffs.
Whether employees are worried about their jobs or personal health and safety, leaders have been called to step up efforts and prove their ability to manage and delegate in this time of uncertainty.
HR will also have a huge role to play in the coming recession. They will need to understand how businesses made it through the previous financial crisis in order to understand how to best manage talent for this one. HR will need to eliminate all non-core work and retain profitable businesses while being sure to understand the competencies to achieve business goals.
HR must also be responsible for communication between employees and teams during a recession. Especially now when the COVID-19 pandemic is still ongoing and many companies are still adopting a work-from-home policy. Communication is key to both operations and morale.
If layoffs are absolutely necessary, HR needs to immediately start rebuilding teams and planning for the recovery. Failing to do so will leave the business unprepared to seize opportunities that will help the company get back on its feet.
HR will also need to take the opportunity to listen to employees, harness everyone’s ideas and enthusiasm about how to use the situation to become better. The best companies will redouble efforts, pull their talent closer, communicate, and invest in talent for future growth.