Are we really in a recession?
Although we won’t officially know for sure for a few months (after our economy as shown two consecutive quarters of negative Gross Domestic Product (GDP) growth), both Morgan Stanley and Goldman Sachs declared global recession back on March 17, 2020.
COVID-19 has claimed lives, overwhelmed our healthcare system, closed businesses, destroyed consumer confidence and rocked the stock market. It’s caused fear and panic.
And it’s already impacted every aspect of our economy – including the staffing industry.
The Domino Effect: What happens in a recession?
Major crises like the one COVID-19 has created have a domino effect on our economy:
- People and companies spend less.
- Business activity declines.
- Less work means less need for workers.
- Hours get cut.
- Flexible workers get let go.
- Unemployment rises.
- Bad debt and loan defaults increase.
- Prices and interest rates tend to fall.
The Domino Effect: Recession’s impact on staffing and recruiting
First, some good news: COVID-19 is actually helping some sectors flourish. Agencies that staff roles in healthcare, IT, collections and finance are already seeing surges in their business.
But if your firm is like most commercial staffing and recruiting agencies, you’re feeling the pain:
- Hiring freezes kill direct hire business.
- Temps get cut first.
- New job orders become scarce.
- Up to 30% of staffing companies go out of business.
Don’t fall into that 30%!
Right now, you need to take decisive action – and we’re here to help. We’ve created several resources to help your staffing agency survive, and even thrive, in these turbulent economic times:
- Download our free eBook, “Strategies for a Changed World: Creating Your Playbook for Success.”
- Visit our COVID-19 Recovery Resources page for more free business strategy and marketing ideas to recession-proof your business.
- Join the new Staffing Works Slack Group. We created a Slack group to help the staffing industry come together to deal with the challenges we are all facing. The group is a place for staffing professionals to discuss sales, marketing, recruiting, technology and other issues that are impacting your company. It is completely free to participate, and just one more thing we’re doing to help staffing professionals thrive in this economy.